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Welcome to ProPublica Illinois
by Louise Kiernan Rohan Patrick McDonald for ProPublica Today, with our story about gun trafficking in Chicago, produced in collaboration with WBEZ Chicago and the Chicago Sun-Times, we are officially launching the ProPublica Illinois website and beginning to regularly publish our journalism.ProPublica Illinois is the first regional operation of ProPublica, the New York-based investigative nonprofit newsroom that has, as it nears its 10th anniversary, achieved far-reaching impact for its work and won four Pulitzer Prizes, among many other awards. We are excited and proud to bring that legacy and mission to Illinois: to produce investigative journalism with moral force, impelled by what matters most in our state.You can meet our 12-member editorial team here. Most of us are Illinois natives or longtime residents, joined by a few brand-new transplants. We bring experience covering criminal justice, housing, municipal finance, immigration, child welfare, government, education, labor and other issues, as well as expertise in data journalism, news applications and engagement. All of us share a passion for investigative journalism and a commitment to uncovering injustice and wrongdoing.What do we hope to accomplish at ProPublica Illinois? Here are a few of our goals:
How Chicago Gets Its Guns
by Mick Dumke John Thomas set up the deal the way he had arranged nearly two dozen others. A friend said he wanted to buy as many guns as he could, so Thomas got in touch with someone he knew who had guns to sell.The three of them met in the parking lot of an LA Fitness in south suburban Lansing at noon on Aug. 6, 2014. Larry McIntosh, whom Thomas had met in his South Shore neighborhood, took two semi-automatic rifles and a shotgun from his car and put them in the buyer’s car. He handed over a plastic shopping bag with four handguns. None of the weapons had been acquired legally — two, in fact, had been reported stolen — and none of the men was a licensed firearms dealer.Thomas’ friend, Yousef, paid McIntosh $7,200 for the seven guns. He always paid well.Thomas did little but watch the exchange, but he got his usual broker’s fee of $100 per gun, $700 total. It was “the most money I’ve seen or made,” he recalled — his biggest deal yet.It was also his last.Amid Chicago’s ongoing epidemic of gun violence — with nearly 500 people killed in shootings and more than 2,800 wounded this year through September — the availability of guns has been blamed as a root cause and become a defining political and public safety issue.City police have seized nearly 7,000 illegal firearms so far in 2017 and federal authorities have stepped up efforts to take down dealers.Still, it’s by no means clear that targeting those like John Thomas makes a real difference.Most of the guns police seize come from Indiana and other states where firearms laws are more lax, police and researchers have found. After they were purchased legally, most were sold or loaned or stolen. Typically, individuals or small groups are involved in the dealing, not organized trafficking rings, experts say.Unlike the drug trade — often dominated by powerful cartels or gangs — illegal gun markets operate more like the way teenagers get beer, “where every adult is potentially a source,” said Philip Cook, a researcher at the University of Chicago Crime Lab who’s also a Duke University professor.Under pressure to respond to the violence, law enforcement has focused on making examples of people caught selling, buying or possessing guns. But authorities acknowledge that these cases do little to stem the flow of guns into the city."You are a single salmon swimming upstream at Niagara Falls," said Anthony Guglielmi, a spokesman for the Chicago Police Department. “If your policing strategy is to decrease the number of guns in your city, good luck, because there are too many guns out there. It’s better to go after the person with the gun.”An in-depth examination of Thomas’ case — based on police reports, court records and interviews, including a series of conversations with Thomas — shows how authorities target mostly street-level offenders, sometimes enticing them with outsized payoffs. In this and other cases, critics say their techniques raise questions of whether they are dismantling gun networks or effectively helping to set them up."You have this specter of whether it's creating crime, which is troubling to a lot of people," said Katharine Tinto, a professor at the University of California Irvine School of Law who has studied the investigative tactics of the U.S. Bureau of Alcohol, Tobacco, Firearms and Explosives. "It’s not as if you’re trying to get someone you know is a violent gun offender. You’re going after someone and purposely trying to entice them into doing a felony."A Natural SalesmanAt 33, John Thomas has a charming smile that sometimes displays his chipped front tooth. His mother’s name, Val, is tattooed on his left forearm — a tribute to her for bringing him into the world, though he said he could never count on her. His daughter's name, Jataviyona, is tattooed on his right shoulder.Even as a kid, Thomas was a natural salesman, quick with a hustle.“That’s my gift, I guess — to sell,” he said.He grew up in the part of South Shore known as “Terror Town.” A short walk from a popular Lake Michigan beach, it’s long been a mix of middle-class homeowners and lower-income renters, with bungalows, condominiums and multi-unit apartment buildings on tree-lined streets.By the time Thomas was growing up in the 1980s and 1990s, the neighborhood was struggling. Many white homeowners and merchants had fled after African-Americans moved in. Thousands of people in South Shore and surrounding communities lost their jobs when the nearby steel mills closed. When the crack epidemic hit in the early 1990s, gang violence soared.Thomas’ father wasn’t around, and his mother struggled with addiction, according to Thomas and a younger sister, Sade Thomas-Adams. With five other siblings, Thomas was raised by an aunt and uncle he considered his parents.Thomas’ uncle was a pastor, and the family spent a lot of time at church, giving him a lifelong faith. During the week, the kids were told to focus on their studies and come home right after school to avoid the dangers of gangs and drugs. Thomas and some of his siblings chafed at those rules, though, escaping from the house to hang out with friends, drink and smoke marijuana.“They had their foot in both worlds — the church and the street,” said Thomas-Adams. This video shows an April 2014 gun deal unfold in Chicago. It was secretly filmed by Yousef, a confidential informant. (Lucas Waldron/ProPublica) Thomas developed his first hustle while in grammar school, he said. He and his friends would offer to help shoppers with their bags and carts outside an Aldi supermarket. He learned he could talk to people and earn tips.Thomas graduated to other ways of making money. First, he said, he sold baggies of fake marijuana. Eventually, neighborhood dealers set him up with real drugs.In November 2001, when he was 17, Thomas was arrested for selling $20 worth of crack cocaine to an undercover police officer, and was convicted and given probation. The incident was one in a long string of cases, including a 2005 gun possession conviction.After that, Thomas began to sell marijuana and developed a successful promotional strategy. When customers bought a nickel bag — a small quantity for $5 — he gave them another for free. “Two for five,” was how he marketed it. His profits, he said, came from volume.“Everybody wanted it,” he said.When he was 20, Thomas began to hang around a new neighborhood store so much the family who ran it offered him a job. Once again, he put his people skills to work. The store sold knockoff gym shoes, but some people didn’t want to come there because it would mean crossing gang lines.“So I’m taking the shoes to them,” Thomas said. “I’m selling them shoes left and right.”Gang violence was a stubborn problem in the neighborhood, and moved ever closer to Thomas. At 16, he said he witnessed a fatal shooting. At 18, an acquaintance killed one of Thomas’ friends. Then, at 22, his best friend from childhood was gunned down.Thomas said he tried to steer clear of guns.“I know what they have done to people,” he said.A New Friend, and an OpportunityIn late 2013, Thomas was desperate. Then 29, he was a new father and the primary caretaker of his daughter, and trying to leave criminal life behind. For several years, he’d worked low-paying jobs at restaurants, grocery stores and an uncle’s construction business, but he struggled to pay his rent. As a convicted felon, options were limited.Then, he met Yousef.Thomas had taken a job at a tobacco shop in the Beverly neighborhood, making $25 a day, he said. There, he hit it off with one of the guys who hung around the store. Yousef was in his 20s and, like Thomas, joked a lot. They started smoking marijuana together. Thomas said Yousef — who, through his lawyer, declined to comment — knew he was broke. Yousef told Thomas he could help — if Thomas helped him.“He comes in and asks me about guns,” Thomas said. “I said that where I’m from, we don’t sell guns.”But Thomas said Yousef kept bringing it up. At some point, he said, Yousef told him he knew a businessman named Pops who could give Thomas a real job if he helped them.What finally persuaded Thomas, he said, was the dollar-store diapers he’d been buying for his daughter: They sometimes gave his daughter hives. He saw the diapers as a sign he was stuck, and his daughter was paying for it.“It was just hard,” he said. “Too hard.”Thomas made his first call — to one of his cousins — in January 2014. Steven Thomas, 38, had served time for attempted murder in his early 20s, court records show. Now, he was trying to rebuild his life. After earning an associate’s degree in prison, he was working to support his family and taking classes to become a massage therapist.Thomas asked if his cousin knew anyone with guns to sell.“The first thing he asked me was, ‘Is everything OK?’” John Thomas recalled.He said his cousin wasn’t sure at first but called back the next day: He’d come up with a couple of guns. John Thomas got in touch with Yousef and introduced him to his cousin at the tobacco shop. He said they went to the back of the store, and when his cousin left a few minutes later, Yousef paid John Thomas $200 for arranging the deal.“Just for a call,” Thomas said. “I didn’t even have to do nothing.”Thomas, giddy, said he used the money to buy food, baby formula and better diapers.What Thomas didn’t know was that Yousef had paid Steven Thomas $400 for a Glock 9mm pistol — then immediately resold the gun for $800, court records show. Even after he paid Thomas, Yousef made a quick $200.Everyone seemed to come out ahead. So the next day, the three men did it all again. Thomas talked with his cousin, who then sold two guns to Yousef, and Thomas made $100. Yousef then sold the guns to Pops for $1,600, twice what he’d just paid for them.To Thomas, it was easy money — money he needed.Warning SignsThomas didn’t know, however, that Yousef was being watched by federal agents.In January 2014, shortly before Yousef approached Thomas, the ATF had launched an initiative in Chicago to “attack violent crime associated with illegal firearms and narcotics.” As part of that effort, the ATF called on a longtime informant.“Confidential Informant 1,” as he was identified by federal prosecutors, is not named in court records. He had worked for the government for nearly a decade, since being indicted for fraud and agreeing to cooperate. Gray-haired and squat, the informant posed as a businessman who wanted to buy weapons he could sell overseas, according to undercover ATF recordings and court records.One of the people he approached about getting guns was Yousef. Authorities have not said why they targeted Yousef and why the informant’s cover story involved selling guns overseas.Through a spokeswoman, the ATF declined comment.In January and February 2014, Yousef met with the informant, whom he knew as Pops, eight times for deals that involved 13 guns, according to court records. Some of those deals involved guns Thomas helped Yousef buy from Thomas’ cousin, the records show. Through September, nearly 500 people were killed in shootings and more than 2,800 wounded, which officials blame on the movement and availability of guns in the city. (John J. Kim/Chicago Tribune via Getty Images) That March, ATF agents confronted Yousef: With Pops’ help, they had been monitoring his gun deals. Yousef faced the possibility of going to prison for unlicensed gun dealing. Or he could work for the government.Yousef agreed to cooperate. In court records, he became “CI-3,” and has not been identified by last name in Thomas’ case. From March to July 2014, the government paid Yousef a total of $6,380 for “living and operational expenses” in addition to the money he used to buy the guns, court records show.Yousef got to work lining up more gun deals, continuing to use Thomas as his primary, but not only, middleman. After his cousin, Thomas brought in an old friend: Anthony Logan, whom everyone called Snake. Thomas told Logan he knew someone who often overpaid for guns.In the spring and summer of 2014, Thomas, Yousef and Pops did several deals with Logan, who introduced them to other friends. When those sources dried up, Thomas arranged quick exchanges in an alley with people he didn’t know himself. There were handoffs in parking lots and a trip to Gary, Indiana, where the deal nearly unraveled and Thomas, hoping to salvage it, wandered the streets until he found the seller.After each sale, Yousef met with ATF agents and turned over the guns and recording equipment he had secretly been wearing, according to court records.As the money kept coming in, Thomas overlooked warning signs. One seller even tried to tell him he might be dealing with informants.“My people are leery about you all,” Thomas told Yousef after talking with a gun source in the south suburbs, according to an ATF report. “They say you all the feds.”Yousef vowed that he wouldn’t do any more business with that supplier.Still, Yousef seemed willing to buy anything. While some of the deals produced semi-automatic rifles and high-powered handguns, he also bought guns that were rusty or missing parts. On one occasion, Thomas even got Yousef to pay $700 for what turned out to be a BB gun — another warning sign Thomas ignored.‘I Ain’t Been Doing Nothing.’That summer, as politicians struggled to deal with violence in the city, Mayor Rahm Emanuel appealed to the Obama administration for help getting guns off the street. The ATF responded by announcing it was sending seven additional agents to Chicago.At the same time, the number of sales Thomas had brokered passed 20, and he had to expand his sources to continue producing guns. He reached out to Larry McIntosh, the friend of a friend from the neighborhood.McIntosh proved to be a consistent source. He sold Yousef more than two dozen guns in the summer of 2014 and promised even bigger deals through a connection in Indiana.That August, he offered a package of at least 14 guns. Yousef and Thomas were set to make the buy on Aug. 26, according to ATF records. But Thomas said Yousef called him at home that morning and asked if they could meet for breakfast to talk about a job offer from Pops. Wearing a favorite Blackhawks shirt and nice jeans, Thomas stepped outside.“It was, like, 5 in the morning,” Thomas recalled. “I see a gray PT Cruiser [with] a white lady, she’s got a computer, and I’m thinking, what is she doing in this neighborhood at this time of the morning? I look on my left, and I see a gray van, and there’s some white guys in it, and I say, ‘Whoa, whoa, this is not right.’”Moments later, one of his uncles arrived to give Thomas a ride, and they left. They had gone only a few blocks when police lights flashed behind them. Thomas was whisked to an ATF facility, where he was read his rights and questioned by two agents, according to the ATF’s video of the interrogation.The agents told him he would be charged with being a felon in possession of a firearm.“Me personally, I ain’t been doing nothing,” Thomas protested.The agent leading the questioning showed Thomas a picture. “There’s you, holding a gun.”After a long pause, Thomas said, “I didn’t buy nothing.”“You didn’t have to buy anything,” the agent said. “We have you on video, holding guns. You set up all the deals.”Thomas wanted to know if Yousef had been working with agents from the beginning.One of the agents said no but encouraged Thomas to become an informant. Thomas refused.‘Like Buying a Pack of Cigarettes’The next day, the U.S. attorney’s office in Chicago announced 14 arrests on federal charges of illegally possessing or selling guns. Thomas was listed as the top defendant, followed by 13 other men involved in the deals with Yousef, including Logan, McIntosh and Steven Thomas.If officials knew the original sources for the guns, they were not named in the court records.In 2015, one at a time, the men entered guilty pleas. McIntosh — who two decades earlier was convicted of involuntary manslaughter after he accidentally shot a woman in the head — was sentenced to 10 years in prison. Logan got eight years and four months. The others received between 18 months and eight years.In every case, prosecutors noted the gun violence battering Chicago and called for sentences long enough to send a message. A Letter From Prison: Wesley Pickett is serving eight years in prison for helping Yousef buy guns. Pickett recently wrote ProPublica Illinois Reporter Mick Dumke a letter sharing his story, as excerpted below. Read the full letter. Many of the defendants, through their lawyers, insisted they had never sold guns until Yousef started offering to buy them.“The government is not seeking to arrest those who are unlawfully selling weapons but effectively making gun dealers out of street level hustlers by paying three and four times the street value of guns,” Ralph Schindler Jr., who represented Logan, said in a court filing.The ATF’s tactics are, in some ways, similar to how federal authorities battle other issues. With political corruption, they have used cooperating witnesses to offer bribes to elected officials. Fighting terrorism, they have contacted and enticed disaffected young men to discuss possible plots. Whether any of those targets would have acted without prodding is hotly debated following an arrest.The ATF spokeswoman would not discuss the agency’s broader strategies.“We try to hit the top people as much as we can,” said a federal law enforcement official who spoke on condition of anonymity. “They’re tough cases to prove. If we can get them on one gun, we can get them off the street.”Wesley Pickett, who is serving eight years for helping Yousef buy guns, admits he was wrong to get involved. But he argues that putting people like him in prison will not stem the flow of weapons.“Getting a gun in the city,” he said in a letter from a federal prison in Pennsylvania, “is like buying a pack of cigarettes at a gas station.”Facing PrisonYousef, too, pleaded guilty to unlicensed firearms dealing. He has not yet been sentenced.After three months in jail following his arrest, Thomas made bail and, in spite of his pending case, got a job as a stocker at a Family Dollar store in Englewood. Within the year, he was promoted to manager.Thomas blames himself for going after the money in the gun deals. But he doesn't believe he played a role in Chicago's gun violence. Though he is streetwise from years running his hustles, he said he believed Yousef’s claims that the guns weren’t headed for the streets. In time, Thomas said he stopped thinking about what was happening to the guns.“Honestly, after a while, once [Yousef] told me that, I didn’t really care no more,” he said. “I just knew that my daughter was straight.” John Thomas said he was struggling to support his daughter, Jataviyona, when he decided to make some money in 2014 by setting up gun deals. Thomas said he stopped thinking about what became of the guns. “I just knew that my daughter was straight,” he said. (Andrew Gill/WBEZ Chicago) As it turned out, the guns never got back to the street. The ATF bought or collected all of the guns Yousef purchased through Thomas.In March, Thomas pleaded guilty to two counts of being a felon in possession of a firearm and one count of unlicensed firearm dealing. Prosecutors said that, over the course of seven months, he brokered 23 transactions involving 77 guns.He faced 25 years in prison.In August, Thomas went before U.S. District Court Judge Andrea Wood to be sentenced. Wearing a tan suit, tan shirt and blue tie, Thomas was accompanied by his daughter, the aunt who raised him, other family members and his pastor. At one point in the sentencing, he wept.Nicole Kim, the federal prosecutor, gave him credit for working and caring for his daughter, then 4, but argued that a message should be sent that “if you need extra money, if you need a job, this is not OK.”“He’s not proud of what he did,” said Heather Winslow, Thomas’ attorney. “But absent the influence of the government’s buy money, this crime would not have happened.”Given the chance to speak, Thomas became emotional.“People make mistakes, and I did,” he said. “I’m not a gun salesman.”The judge noted that the government played a role in every deal for which Thomas was being sentenced. But, in spite of the government’s involvement, she told him he should have said no.“It is difficult in some ways to reconcile the responsible worker and father I’ve seen in my courtroom with the person who would be willing to move 77 firearms,” Wood said.The sentence: seven years in prison. She allowed Thomas to spend several weeks with his daughter before beginning his sentence.On Oct. 9, he reported to a medium-security federal prison in central Illinois.
ProPublica Illinois Begins Regular Publishing, Announces New Partnerships
by ProPublica ProPublica Illinois, the first regional publishing operation of the nonprofit newsroom ProPublica, launched today with a look inside a gun trafficking case in Chicago. The site will focus on investigative journalism that exposes wrongdoing across Illinois and spurs positive change.With a staff of 12 now in place, ProPublica Illinois seeks to help address the precarious position of accountability journalism across the country, with decreasing numbers of newspaper editors and reporters.“While Illinois has a wealth of subjects for investigative journalism, there are always more stories to uncover than there are reporters to dig into them,” said Louise Kiernan, ProPublica Illinois editor-in-chief. “Our goal is to bring the unique strengths of ProPublica — such as our data-driven approach and our ability to stick with subjects as long as it takes — to report stories that would not otherwise be told.”Just as ProPublica has done nationally, the Illinois newsroom is sharing its work and resources with other media organizations in the state. Today’s story, “How Chicago Gets Its Guns,” is co-published with the Chicago Sun-Times and WBEZ Chicago. In the piece, reporter Mick Dumke examines the federal Bureau of Alcohol, Tobacco, Firearms and Explosives’ tactic of setting up illegal firearms deals by using paid informants to lure low-level offenders, illustrating this practice through a deep dive into one troubling case.ProPublica Illinois has also initiated partnerships to help build a broader community of investigative journalists. With City Bureau, a small journalism nonprofit on Chicago’s South Side, reporters are developing an open-source database of every public meeting in Chicago. In collaboration with Illinois Humanities, ProPublica is offering a $15,000 grant for a project focused on reaching underserved downstate audiences. Several reporting partnerships are underway with a number of media organizations in Chicago and other cities.Nearly 10 years after the founding of ProPublica, with a record of substantial impact from its journalism, ProPublica Illinois will leverage this same model to make a meaningful difference across the state.
How the CIA Staged Sham Academic Conferences to Thwart Iran’s Nuclear Program
by Daniel Golden The CIA agent tapped softly on the hotel room door. After the keynote speeches, panel discussions and dinner, the conference attendees had retired for the night. Audio and visual surveillance of the room showed that the nuclear scientist’s minders from the Islamic Revolutionary Guard Corps were sleeping but he was still awake. Sure enough, he opened the door, alone.According to a person familiar with this encounter, which took place about a decade ago, the agency had been preparing it for months. Through a business front, it had funded and staged the conference at an unsuspecting foreign institution of scientific research, invited speakers and guests, and planted operatives among the kitchen workers and other staff, just so it could entice the nuclear expert out of Iran, separate him for a few minutes from his guards, and pitch him one-on-one. A last-minute snag had almost derailed the plans: The target switched hotels because the conference’s preferred hotel cost $75 more than his superiors in Iran were willing to spend.To show his sincerity and goodwill, the agent put his hand over his heart. “Salam habibi,” he said. “I’m from the CIA, and I want you to board a plane with me to the United States.” The agent could read the Iranian’s reactions on his face: a mix of shock, fear and curiosity. From prior experience with defectors, he knew the thousand questions flooding the scientist’s mind: What about my family? How will you protect me? Where will I live? How will I support myself? How do I get a visa? Do I have time to pack? What happens if I say no?The scientist started to ask one, but the agent interrupted him. “First, get the ice bucket,” he said.“Why?”“If any of your guards wake up, you can tell them you’re going to get some ice.”In perhaps its most audacious and elaborate incursion into academia, the CIA secretly spent millions of dollars staging scientific conferences around the world. Its purpose was to lure Iranian nuclear scientists out of their homeland and into an accessible setting where its intelligence officers could approach them individually and press them to defect. In other words, the agency sought to delay Iran’s development of nuclear weapons by exploiting academia’s internationalism, and pulling off a mass deception on the institutions that hosted the conferences and the professors who attended and spoke at them. The people attending the conference had no idea they were acting in a drama that simulated reality but was stage-managed from afar. Whether the national security mission justified this manipulation of the professoriate can be debated, but there’s little doubt that most academics would have balked at being dupes in a CIA scheme.More than any other academic venue, conferences lend themselves to espionage. Assisted by globalization, these social and intellectual rituals have become ubiquitous. Like stops on the world golf or tennis circuits, they sprout up wherever the climate is favorable, and draw a jet-setting crowd. What they lack in prize money, they make up for in prestige. Although researchers chat electronically all the time, virtual meetings are no substitute for getting together with peers, networking for jobs, checking out the latest gadgets, and delivering papers that will later be published in volumes of conference proceedings. “The attraction of the conference circuit,” English novelist David Lodge wrote in “Small World,” his 1984 send-up of academic life, is that “it’s a way of converting work into play, combining professionalism with tourism, and all at someone else’s expense. Write a paper and see the world!”The importance of a conference may be measured not only by the number of Nobel Prize winners or Oxford dons it attracts, but by the number of spies. U.S. and foreign intelligence officers flock to conferences for the same reason that Army recruiters concentrate on low-income neighborhoods: They make the best hunting grounds. While a university campus may have only one or two professors of interest to an intelligence service, the right conference — on drone technology, perhaps, or ISIS — may have dozens.“Every intelligence service in the world works conferences, sponsors conferences, and looks for ways to get people to conferences,” says a former CIA operative.“Recruitment is a long process of seduction,” said Mark Galeotti, senior researcher at the Institute of International Relations Prague and former special adviser to the British foreign office. “The first stage is to arrange to be at the same workshop as a target. Even if you just exchange banalities, the next time you can say, ‘Did I see you in Istanbul?’”The FBI warned American academics in 2011 to be cautious about conferences, citing this scenario: “A researcher receives an unsolicited invitation to submit a paper for an international conference. She submits a paper and it is accepted. At the conference, the hosts ask for a copy of her presentation. The hosts hook a thumb drive to her laptop, and unbeknownst to her, download every file and data source from her computer.”The FBI and CIA swarm conferences, too. At gatherings in the United States, says a former FBI agent, “foreign intelligence officers try to collect Americans; we try to collect them.” The CIA is involved with conferences in various ways: It sends officers to them; it hosts them through fronts in the Washington area, so that the intelligence community can tap academic wisdom; and it mounts sham conferences to reach potential defectors from hostile countries.The CIA monitors upcoming conferences worldwide and identifies those of interest. Suppose there is an international conference in Pakistan on centrifuge technology: The CIA would send its own agent undercover, or enlist a professor who might be going anyway to report back. If it learns that an Iranian nuclear scientist attended the conference, it might peg him for possible recruitment at the next year’s meeting.Intelligence from academic conferences can shape policy. It helped persuade the George W. Bush administration — mistakenly, as it turned out — that Saddam Hussein was still developing weapons of mass destruction in Iraq. “What our spies and informants were noticing, of course, was that Iraqi scientists specializing in chemistry, biology, and, to a lesser extent, nuclear power kept showing up at international symposia,” former CIA counterterrorism officer John Kiriakou wrote in a 2009 memoir. “They presented papers, listened to the presentation of others, took copious notes, and returned to Jordan, where they could transmit overland back to Iraq.”Some of those spies may have drawn the wrong conclusions because they lacked advanced degrees in chemistry, biology or nuclear power. Without expertise, agents may misunderstand the subject matter, or be exposed as frauds. At conferences hosted by the International Atomic Energy Agency in Vienna on topics such as isotope hydrology and fusion energy, “there’s probably more intelligence officers roaming the hallways than actual scientists,” says Gene Coyle, who worked for the CIA from 1976 to 2006. “There’s one slight problem. If you’re going to send a CIA guy to attend one of these conferences, he has to talk the talk. It’s hard to send a history major. ‘Yes, I have a PhD in plasma physics.’ Also, that’s a very small world. If you say you’re from the Fermi Institute in Chicago, they say, ‘You must know Bob, Fred, Susie.’”Instead, Coyle says, the agency may enlist a suitable professor through the National Resources Division, its clandestine domestic service, which has a “working relationship” with a number of scientists. “If they see a conference in Vienna, they might say, ‘Professor Smith, that would seem natural for you to attend.’”“Smith might say, ‘I am attending it, I’ll let you know who I chatted with. If I bump into an Iranian, I won’t run in the opposite direction.’ If he says, ‘I’d love to attend, but the travel budget at the university is pretty tight,’ the CIA or FBI might say, ‘Well, you know, we might be able to take care of your ticket, in economy class.’”A spy’s courtship of a professor often begins with a seemingly random encounter — known in the trade as a “bump” — at an academic conference. One former CIA operative overseas explained to me how it works. I’ll call him “R.”“I recruited a ton of people at conferences,” R told me. “I was good at it, and it’s not that hard.”Between assignments, he would peruse a list of upcoming conferences, pick one, and identify a scientist of interest who seemed likely to attend after having spoken at least twice at the same event in previous years. R would assign trainees at the CIA and NSA to develop a profile of the target — educational background, college instructors and so on. Then he would cable headquarters, asking for travel funding. The trick was to make the cable persuasive enough to score the expense money, but not so compelling that other agents who read it, and were based closer to the conference, would try to preempt him.Next he developed his cover — typically, as a businessman. He invented a company name, used GoDaddy.com to build a website and printed business cards. He created billing, phone and credit card records for the nonexistent company. For his name, he chose one of his seven aliases.R was no scientist. He couldn’t drop in a line about the Riemann hypothesis as an icebreaker. Instead, figuring that most scientists are socially awkward introverts, he would sidle up to the target at the edge of the conference’s get-together session and say, “Do you hate crowds as much as I do?” Then he would walk away. “The bump is fleeting,” R says. “You just register your face in their mind.”No one else should notice the bump. It’s a rookie mistake to approach a target in front of other people who might be minders assigned by the professor’s own country. The minders would report the conversation, compromising the target’s security and making them unwilling or unable to entertain further overtures.For the rest of the conference, R would “run around like crazy,” bumping into the scientist at every opportunity. With each contact, called “time on target” in CIA jargon and counted in his job performance metrics, he insinuated himself into the professor’s affections. For instance, having done his homework, R would say he had read a wonderful article on such-and-such topic but couldn’t remember the author’s name. “That was me,” the scientist would say, blushing.After a couple of days, R would invite the scientist to lunch or dinner and make his pitch: His company was interested in the scientist’s work and would like to support it. “Every academic I have ever met is constantly trying to figure how to get grants to continue his research. That’s all they talk about.” They would agree on a specific project, and the price, which varied by the scientist’s country: “One thousand to five thousand dollars for a Pakistani. Korea is more.” Once the CIA pays foreign professors who are unaware at first of the funding source, it controls them, because exposure of the relationship might imperil their careers or even their lives in their native country.Scientific conferences have become such a draw for intelligence agents that one of the biggest concerns for CIA operatives is interference from agency colleagues trapping the same academic prey. “We tend to flood events like these,” a former CIA officer who writes under the pseudonym Ishmael Jones observed in his 2008 book, “The Human Factor: Inside the CIA’s Dysfunctional Intelligence Culture.” At one 2005 conference in Paris that he anticipated would be a “perfect watering hole for visiting rogue state weapons scientists,” Jones recalled, his heart sank as he glanced across the room and saw two CIA agents (who were themselves professors). He avoided their line of sight while he roamed the gathering, eyeballing nametags and trawling for “people who might make good sources,” ideally from North Korea, Iran, Libya, Russia or China.“I’m surprised there’s so much open intelligence presence at these conferences,” Karsten Geier said. “There are so many people running around from so many acronyms.” Geier, head of cybersecurity policy for the German foreign office, and I were chatting at the Sixth Annual International Conference on Cyber Engagement, held in April 2016 at Georgetown University in Washington, D.C. The religious art, stained-glass windows and classical quotations lining Gaston Hall enveloped the directors of the NSA and the FBI like an elaborate disguise as they gave keynote addresses on combating one of the most daunting challenges of the twenty-first century: cyberattacks.The NSA’s former top codebreaker spoke, as did the ex-chairman of the National Intelligence Council, the deputy director of Italy’s security department and the director of a center that does classified research for Swedish intelligence. The name tags that almost all of the seven hundred attendees wore showed that they worked for the US government, foreign embassies, intelligence contractors, or vendors of cyber-related products, or they taught at universities.Perhaps not all of the intelligence presence was open. Officially, 40 nations — from Brazil to Mauritius, Serbia to Sri Lanka — were represented at the conference, but not Russia. Yet, hovering in the rear of the balcony, a slender young man, carrying a briefcase, listened to the panels. No name tag adorned his lapel. I approached him, introduced myself and asked his name. “Alexander,” he said, and, after a pause, “Belousov.”“How do you like the conference?”“No,” he said, trying to ward off further inquiries. “I am from Russian embassy. I don’t have any opinions. I would like to know, that’s all.”I proffered a business card, and requested his, in vain. “I am here only a month. My cards are still being produced.”I persisted, asking about his job at the embassy. (A subsequent check of a diplomatic directory showed him as a “second secretary.”) He looked at his watch. “I am sorry. I must go.”When the CIA wants Professor John Booth’s opinion, it phones him to find out if he’s available to speak at a conference. But the agency’s name is nowhere to be found on the conference’s formal invitation and agenda, which invariably list a Beltway contractor as the sponsor.By hiding its role, the CIA makes it easier for scholars to share their insights at its conferences. They take credit for their presentations on their curriculum vitae without disclosing that they consulted for the CIA, which might alienate some academic colleagues as well as the countries where they conduct their research.An emeritus professor of political science at the University of North Texas, Booth specializes in studying Latin America, a region where history has taught officials to be wary of the CIA. “If you were intending to return to Latin America, it was very important that your CV not reflect” these kinds of presentations, Booth told me in March 2016. “When you go to one of these conferences, if there are intelligence or defense agency principals there, it’s invisible on your CV. It provides a fig leaf for participants. There’s still some bias in academia against this. I don’t go around in Latin American studies meetings saying I spent time at a conference run by the CIA.”The CIA arranges conferences on foreign policy issues so that its analysts, who are often immersed in classified details, can learn from scholars who understand the big picture and are familiar with publicly available sources. Participating professors are generally paid a $1000 honorarium, plus expenses. With scholarly presentations followed by questions and answers, the sessions are like those at any academic meeting, except that many attendees — presumably, CIA analysts — wear name tags with only their first names.Of ten intelligence agency conferences that Booth attended over the years, most recently a 2015 session about a wave of Central American refugee children pouring into the United States, the CIA and Office of the Director of National Intelligence directly ran only one or two. The rest were outsourced to Centra Technology Inc., the leader of a growing industry of Beltway intermediaries — “cutouts,” in espionage parlance — that run conferences for the CIA.The CIA supplies Centra with funding and a list of people to invite, who gather in Centra’s Conference Center in Arlington, Virginia. It’s “an ideal setting for our clients’ conferences, meetings, games, and collaborative activities,” according to Centra’s website.“If you know anything, when you see Centra, you know it’s likely to be CIA or ODNI [Office of the Director of National Intelligence],” said Robert Jervis, a Columbia University professor of international politics and longtime CIA consultant. “They do feel that for some academics thin cover is useful.”Established in 1997, Centra has received more than $200 million in government contracts, including $40 million from the CIA for administrative support, such as compiling and redacting classified cables and documents for the five-year Senate Intelligence Committee study of the agency’s torture program. As of 2015, its executive ranks teemed with former intelligence officials. Founder and chief executive Harold Rosenbaum was a science and technology adviser to the CIA. Senior vice president Rick Bogusky headed the Korea division at the Defense Intelligence Agency. Vice president for research James Harris managed analytic programs at the CIA for 22 years. Peggy Lyons, director of global access, was a longtime CIA manager and officer with several tours in East Asia. David Kanin, Centra analytic director, spent 31 years as a CIA analyst.Like Booth, Indiana University political scientist Sumit Ganguly has spoken at several Centra conferences. “Anybody who works with Centra knows they’re in effect working for the U.S. government,” he said. “If it said CIA, there are others who would fret about it. I make no bones about it to my colleagues. If it sticks in their craw, it’s their tough luck. I am an American citizen. I feel I should proffer the best possible advice to my government.”Another political scientist, who has given four presentations for Centra, said he was told that it represented unnamed “clients.” He didn’t realize the clients were US intelligence agencies until he noticed audience members with first-name-only name tags. He later ran into one or two of the same people at an academic conference. They weren’t wearing name tags and weren’t listed in the program.Centra strives to mask its CIA connections. It removed its executives’ biographies from its website in 2015. The “featured customers” listed there include the Department of Homeland Security, the FBI, the Army and 16 other branches of the federal government — but not the CIA. When I phoned Rosenbaum and asked him about Centra holding conferences for the CIA, he said, “You’re calling the wrong person. We have nothing to do with that.” And then he hung up.I dropped by Centra’s offices on the fifth floor of a building in Burlington, Massachusetts, a northern suburb of Boston. The sign-in sheet asked visitors for their citizenship and “type of visit”: classified or not. The receptionist fetched human resources director Dianne Colpitts. She politely heard me out, checked with Rosenbaum and told me that Centra wouldn’t comment.“To be frank,” she said, “our customers prefer us not to talk to the media.”For Iranian academics escaping to the West, academic conferences are a modern-day underground railroad. The CIA has taken full advantage of this vulnerability. Beginning under President George W. Bush, the U.S. government had “endless money” for covert efforts to delay Iran’s development of nuclear weapons, the Institute for Science and International Security’s David Albright told me. One program was the CIA’s Operation Brain Drain, which sought to spur top Iranian nuclear scientists to defect.Because it was hard to approach the scientists in Iran, the CIA enticed them to academic conferences in friendly or neutral countries, a former intelligence officer familiar with the operation told me. In consultation with Israel, the agency would choose a prospect. Then it would set up a conference at a prestigious scientific institute through a cutout, typically a businessman, who would underwrite the symposium with $500,000 to $2 million in agency funds. The businessman might own a technology company, or the agency might create a shell company for him, so that his support would seem legitimate to the institute, which was unaware of the CIA’s hand. “The more clueless the academics are, the safer it is for everybody,” the ex-officer told me. Each cutout knew he was helping the CIA, but he didn’t know why, and the agency would use him only once.The conference would focus on an aspect of nuclear physics that had civilian applications and also dovetailed with the Iranian target’s research interests. Typically, Iran’s nuclear scientists also held university appointments. Like professors anywhere, they enjoyed a junket. Iran’s government sometimes allowed them to go to conferences, though under guard, to keep up with the latest research and meet suppliers of cutting-edge technology — and for propaganda.“From the Iranian point of view, they would clearly have an interest to send scientists to conferences about peaceful uses of nuclear power,” Ronen Bergman told me. A prominent Israeli journalist, Bergman is the author of “The Secret War with Iran: The 30-Year Clandestine Struggle Against the World’s Most Dangerous Terrorist Power,” and is working on a history of Israel’s central intelligence service, the Mossad. “They say, yes, we send our scientists to conferences to use civilian technology for a civilian purpose.”The CIA officer assigned to the case might pose as a student, a technical consultant or an exhibitor with a booth. His first job would be to peel the guards away from the scientist. In one instance, kitchen staff recruited by the CIA poisoned the guards’ meal, leaving them incapacitated by diarrhea and vomiting. The hope was that they would attribute their illness to airplane food or an unfamiliar cuisine.With luck, the officer would catch the scientist alone for a few minutes, and pitch him. He would have boned up on the Iranian by reading files and courting “access agents” close to him. That way, if the scientist expressed doubt that he was really dealing with the CIA, the officer could respond that he knew everything about him, even the most intimate details — and prove it. One officer told a potential defector, “I know you had testicular cancer and you lost your left nut.”Even after the scientist agreed to defect, he might reconsider and run away. “You’re constantly re-recruiting the guy.” Once he was safely in a car to the airport, the CIA coordinated the necessary visas and flight documents with allied intelligence agencies. It would also spare no effort to bring his wife and children to the United States — though not his mistress, as one scientist requested. The agency would resettle the scientist and his family and provide long-term benefits, including paying for the children’s college and graduate school.Enough scientists defected to the United States, through academic conferences and other routes, to hinder Iran’s nuclear weapons program, the ex-officer familiar with the operation told me. He said an engineer who assembled centrifuges for Iran’s nuclear program agreed to defect on one condition: that he pursue a doctorate at MIT. Unfortunately, the CIA had spirited him out of Iran without credentials such as diplomas and transcripts. At first, MIT refused the CIA’s request to consider him. But the agency persisted, and the renowned engineering school agreed to accommodate the CIA by waiving its usual screening procedures. It mustered a group of professors from related departments to grill the defector. He aced the oral exam, was admitted and earned his doctorate.MIT administrators denied any knowledge of the episode. “I’m completely ignorant of this,” said Gang Chen, chairman of mechanical engineering.However, two academics corroborated key elements of the story. Muhammad Sahimi, a professor of petroleum engineering at the University of Southern California who studies Iranian nuclear and political development, told me that a defector from Iran’s nuclear program received a doctorate from MIT in mechanical engineering.Timothy Gutowski, an MIT professor of mechanical engineering, said, “I do know of a young man that was here in our lab. Somehow I learned that he did work on centrifuges in Iran. I started thinking, ‘What went on here?’”With Iran’s agreement in 2015 to limit nuclear weapons development in return for lifting of international sanctions, recruitment of defectors from the program by U.S. intelligence lost some urgency. But if President Donald Trump scraps or seeks to renegotiate the deal, which he denounced in a September speech to the United Nations General Assembly, CIA-staged conferences to snag key Iranian nuclear scientists could make a clandestine comeback.
‘Partisan’ Gerrymandering Is Still About Race
by Olga Pierce and Kate Rabinowitz The Wisconsin voting rights case before the Supreme Court has been cast as the definitive test of whether partisan gerrymandering is permitted by the Constitution. But a closer look at the case and others like it shows that race remains an integral element of redistricting disputes, even when the intent of those involved was to give one party an advantage.Consider Gill v. Whitford, the Wisconsin case that was argued last week before the nation’s highest court.During its journey through the legal system, the case has turned on whether Republicans secured an impermissible advantage over Democrats in the way Wisconsin’s Republican-controlled legislature redrew district lines after the 2010 census.But because of the deep racial divides that pervade American politics, the story is not that simple.Wisconsin’s Democratic Party includes a substantial number of African-American and Latino voters, particularly in cities like Milwaukee. When you look more closely at redistricting plans drawn in Wisconsin and elsewhere, you see that both parties have improved their statewide prospects by diminishing the political power of minority voters.As they fight in court over lines drawn after the 2010 census, Democrats and Republicans alike are anxiously waiting to see what the decision in the Wisconsin case will let them do after the 2020 census.Michael Li, senior counsel at the Democracy Program at New York’s Brennan Center, said the ruling carries extra weight because we can expect the most sophisticated chicanery yet.“I’m worried about a record level of gamesmanship in 2021,” said Li. “There could be an unprecedented redistricting war, and both sides are going into it fully armed.”Paul Smith, the attorney presenting oral arguments on behalf of the voters challenging the Wisconsin map, echoed this sentiment.“What the court needs to know is it’s — this is a cusp of a really serious, more serious problem,” Smith told the justices. As computing power and data for redistricting continue to improve, he said, “you’re going to have a festival of copycat gerrymandering the likes of which this country has never seen.”While many voters would be affected by such a festival, not all voters would be affected equally.The record shows that the reliably Democratic voters in communities of color are crucial chess pieces in the partisan game that is redistricting. Republicans often benefit from packing such voters into districts, making other districts safer for Republican candidates. Conversely, a state’s Democratic Party can benefit if it divides communities of color among many districts, giving each a reliable majority of voters who will support the party’s candidates. This technique, known as “cracking” in map drawers’ argot, often harms minorities, voters who might have greater clout if they were kept in a single district. In some cases it has proved politically expedient for the party drawing the lines to both crack and pack minority voters.The Supreme Court’s 2013 decision in Shelby County v. Holder largely ended prior review of district lines by the Justice Department. That, along with rapidly improving technology that makes it ever easier to hide manipulation of communities of color for partisan gain, and the influx of massive amounts of dark money into redistricting, have put some of the voting power of minorities in jeopardy.If the Supreme Court upholds the lower court decision in Gill, it will allow judges to evaluate, and possibly reject, redistricting maps based on a mathematical formula intended to identify partisan gerrymandering. It could offer those suing on behalf of minority voters a tool for fighting racial discrimination that wouldn’t require the high standard of proof and commitment of resources a typical Voting Rights Act case would, said Leah Aden, senior counsel at the NAACP Legal Defense Fund.Upholding the lower court ruling in Gill would also reduce the incentive for political parties to use perverse (some would say cynical) interpretations of the Voting Rights Act and Constitution as a way to defend or attack partisan maps, Aden said. In Wisconsin, and also in Texas and North Carolina, gerrymandered maps have been defended by parties with an argument Aden called “The VRA Made Me Do It.”Gill v. Whitford features a novel variation of this tactic. A brief filed by the Republican Party contends that using the suggested mathematical formula to flag districts drawn for partisan reasons would violate the Voting Rights Act because districts with a majority of minority voters — Democratic districts — could get flagged as unfairly drawn.At times, Democrats have also invoked the Voting Rights Act for partisan reasons, according to Smith, the attorney who argued the Democrats’ side in Gill v. Whitford. The formula endorsed by the lower courts would allow Democrats to challenge redistricting lines without classifying their objections as a defense of minority voting rights, Smith said during oral arguments. This would reserve the important tools for protecting minority voting rights for cases in which they are legitimately needed.Let’s start with Wisconsin. It may indeed be a partisan gerrymander, but it still illustrates the complex intersection of race and politics.Manipulating a map to move around Wisconsin Democrats also means manipulating a map to move around Wisconsin voters who are not white, said Malia Jones, an applied demographer at The University of Wisconsin-Madison.“Wisconsin is one of the most segregated states in the nation,” Jones said. “When we are talking about geography we are also talking about race.”One example can be seen in an assembly district on the western edge of Milwaukee, a city infamous for its near-perfect division between downtown African-American neighborhoods and white affluent suburbs. In an unprecedented move, Republican map drawers crossed the Milwaukee County line to loop 60 percent minority city neighborhoods into a sprawling suburban district that is, after the redistricting, 87 percent white, according to a ProPublica analysis. In Highly Segregated Areas Like Milwaukee, Race Always Plays a Factor in Redistricting Proportion of white, black, and Hispanic residents in Milwaukee County This is, in fact, a dilution of Democratic voting power. But it also places thousands of African-American and Latino citizens in a heavily white district where they have little hope of electing a candidate who will represent their interests.“Clearly there is an impact on minority populations,” Jones said.As in many gerrymandering cases, the attorneys defending the state’s redistricting have argued that the map reflects, among other considerations, an effort to comply with the Voting Rights Act and protect minority voters.The first test of the Wisconsin map was a successful challenge arguing racial discrimination. In Baldus v. Brennan, federal judges ruled that two state assembly districts in the Latino area of Milwaukee were an example of cracking.Depositions given by the Republican map drawers as part of the case show that this was hardly an accident. They sought input from the Mexican American Legal Defense and Educational Fund, but then disregarded it in order to limit consideration of Latino voters to two assembly districts and keep the rest of the map intact.Emails surfaced showing the map drawers had worked with a political science professor in Oklahoma to manipulate the difference between the number of voting-age Latino residents in a district and the number who are citizens and eligible to vote. View note While the court found that Latino voters’ rights had been violated, they only changed the two assembly districts.20171006-gridmap-preclearanceAKMEVTNHMAWAMTNDSDMNWIMINYCTRIORIDWYNEIAILINOHPANJCANVUTCOKSMOKYWVDCMDDEAZNMOKARTNVANCTXLAMSALGASCHIFLStates previously subject to preclearanceStates with counties previously subject to preclearanceThe outcome of Gill comes at a time when minority voters are facing obstacles they haven’t faced in decades.Before 2013, Section 5 of the Voting Rights Act required states and municipalities with a history of discrimination against minority voters to submit redistricting plans to the Department of Justice for review by attorneys, investigators, data analysts and sometimes political scientists.The Department of Justice could reject the plan, preventing the proposed districts from ever being used in an election. The state or municipality could challenge the decision in federal court, but would be up against the formidable resources of the department.Though it was imperfect, “there’s no doubt preclearance had a significant deterrent effect,” said John Powers, a former Section 5 analyst at the agency who now works for the Lawyers' Committee for Civil Rights Under Law.It also forced jurisdictions to report changes to districts, Powers said. While a change to a congressional district is unlikely to go unnoticed, a change at the local level might — even though those lines can have a huge impact on citizens’ lives. “Now, they can make changes and it’s possible no one will even know.”In 2013, however, the Supreme Court ended many protections of the law. Though Section 5 is still in place, nearly all jurisdictions once subject to preclearance are no longer.States and other jurisdictions did not even wait for the next census to get to work on re-engineering their political maps. The state of Georgia and municipalities in Louisiana, North Carolina and Texas drew new lines, prompting immediate lawsuits. All would have required pre-approval before the Shelby ruling.For example, Georgia currently faces a lawsuit from the NAACP over two changes in their mid-decade redistricting. Ahead of the 2016 election, legislators shifted over a thousand African-American and Hispanic voters out of Georgia House District 105, one of the most contested seats in the state, to a majority-white neighboring district with an uncontested seat. The Republican incumbent in District 105 won by fewer than 250 votes.Republicans were “trying to shore up districts that were too close for comfort by moving around African-Americans,” said Li. Georgia’s Mid-Decade Redistricting Plan Moved Around Minority Voters to Secure a Republican Seat Georgia Assembly Districts, 2014 vs. 2016 20171006-gridmap-pendingAKMEVTNHMAWAMTNDSDMNWIMINYCTRIORIDWYNEIAILINOHPANJCANVUTCOKSMOKYWVDCMDDEAZNMOKARTNVANCTXLAMSALGASCHIFLPending Redistricting CasesThe effective end of preclearance shifted the burden of policing the system from the government to privately funded lawsuits, and it allowed contested maps to come into effect while those costly lawsuits wended their way through the courts — often, for years.Anita Earls, an attorney who has handled many redistricting lawsuits — including the ongoing suit in North Carolina — said even simple cases that do not go to trial can cost tens of thousands of dollars. A recent lawsuit over city council redistricting in Pasadena, Texas, cost plaintiffs over a million dollars. Larger cases, like North Carolina House and Senate redistricting, can run up legal bills of millions of dollars and take many years. In some cases, the defendants can eventually be compelled by the court to pay the plaintiffs’ legal bills, but plaintiffs are required to front the money. Reimbursements are by no means guaranteed.Earls said her group, the Southern Coalition for Social Justice, has had to turn down requests for help.“There are a lot of different cases where we have to tell them we don’t have money and staff,” she said. “There are places where people end up just kind of living with the unfair plan.”Redistricting lawsuits also take time — often years — a phenomenon that supporters of the Whitford plaintiffs hope will be ameliorated by removing the complication of challenging districts one at a time.While the court challenges drag on, interim lines often remain in effect as votes are cast. North Carolina has gone through three election cycles using state legislative lines later found to be discriminatory. In 2017, 19 North Carolina House Districts Were Overturned for Packing Black Voters Black population by North Carolina House Districts and overturned districts When party operatives and legislators draw maps, they are aware that it could take years to overturn a redistricting plan, and intentionally use delaying tactics to make sure elections take place under the most favorable circumstances, Earls said.In North Carolina, she said, state officials “at every step of the way tried to delay litigation, did everything they could to stretch this out.”As ProPublica has previously reported, donors who supported the racially gerrymandered plan even used a front group to manipulate state judicial elections, so as to ensure redistricting cases would be heard by a Republican panel of judges.Pressure on state judges further delayed the legal process, forcing the litigants contesting North Carolina’s redistricting plan to turn to the federal courts, Earls said.Such delays can pay political dividends. During the years North Carolina’s maps were being challenged in court, the legislature under the disputed map passed laws that substantially affected African Americans. Lawmakers imposed stricter rules for voter ID and eliminated the state’s earned income tax credit, a provision that lowers the taxes paid by the poorest residents.“North Carolina has had a crazy few years in terms of legislation,” said Li of the Brennan Center. “You can’t turn back the clock, what’s happened has happened.”While citizen groups struggle to find resources to mount redistricting battles, state legislators use money from the state treasury to defend their redistricting maps. Regardless of the outcome, the taxpayers, not the political parties or campaign committees, end up on the hook for legal costs.North Carolina’s redistricting saga also illustrates the false distinction between race and politics that permeates redistricting.In their secret map-drawing process, Republican operatives were explicit about their plan to achieve their desired political outcome: a “10-3” map that had 10 safe Republican congressional districts with only three for Democrats, a big change for a state that at the time had a delegation with seven Democrats and six Republicans. View note And they were also pretty explicit — at least to each other — about how they planned to achieve their desired party breakdown.In an email circulating two proposed maps, Tom Hofeller, a Republican redistricting expert sent in by the national Republican Party wrote that both “incorporate all the significant concentrations of minority voters in the northeast into the first district.” View note Earlier this year, the Supreme Court affirmed lower court decisions that found North Carolina’s congressional and state legislative maps discriminated against minority voters, specifically by packing minorities into a small number of districts to achieve the maximum number of Republican-friendly seats.Required to draw new maps, Republican state party leadership announced they would achieve the same 10-3 congressional delegation breakdown, and the same healthy majority in the state legislature, without looking at race at all.“Race was not among the criteria we considered when we drew these maps,” David Lewis, the Republican member of the state assembly who served as the redistricting point person, told the Associated Press.Hofeller, the same consultant who drew the original maps, would redraw the maps only looking at political data, with an eye to protecting incumbents elected under previous maps, Lewis said.In other words, a strictly partisan gerrymander.But the groups who originally sued against the racially gerrymandered maps said the new maps had simply become discriminatory against African-American voters elsewhere in the state. Once again, they asked the courts to strike those maps down. The case is pending.“You can’t comply with Voting Rights Act and avoid racial bias by simply ignoring race altogether,” said Bob Hope, Executive Director of Democracy NC.20171006-gridmap-overturnedAKMEVTNHMAWAMTNDSDMNWIMINYCTRIORIDWYNEIAILINOHPANJCANVUTCOKSMOKYWVDCMDDEAZNMOKARTNVANCTXLAMSALGASCHIFLLegislative districts overturnedin at least two of the last three decades Some states have been found to violate the civil rights of minority voters during multiple redistricting cycles. Texas’ district lines — drawn by both Republican and Democrat-controlled legislatures — have been thrown out on racial-discrimination grounds for nearly 30 years — during the redistricting of the 1990s, the 2000s and the 2010s. Texas Is No Stranger to Overturned Gerrymanders Three decades of struck-down congressional district maps Emails between those who drew the maps in 2010 show intentional exploitation of Hispanic voters to achieve partisan goals.In a series of emails between map drawers, they discuss a phenomenon called “OHRVS,” an acronym which stands for Optimal Hispanic Republican Voting Strength. That acronym was defined by Eric Opiela, a Republican party operative, as “a measure of how Hispanic, and Republican at the same time we can make a particular census block.” By substituting groups of Hispanic voters with low voter turnout for those with high turnout, Republicans were able to draw hypothetical maps that would create seemingly impossible political districts. One example is a 67 percent Hispanic congressional district that the map drawers projected would nonetheless likely have been won by John McCain or former Republican Gov. Rick Perry.Texas, which in the 1990s was run by Democrats, also contradicts the notion that Democratic party interests necessarily align with those of minority voters, Aden said.“In current politics Republicans dominate state legislatures, so more recently it’s Republicans that have been accused of undermining the redistricting process,” she said, but before this recent turn, districts in Texas, Arkansas and Mississippi drawn by Democrat-controlled legislatures were found to be discriminatory.Though scrutiny of statewide partisan redistricting (one of Gill’s possible outcomes) could be a useful tool to keep state parties from going overboard — and also to fight racial gerrymandering — it cannot detect the subtleties of racial gerrymandering like those that took place in Georgia and Wisconsin.Those gerrymanders will still have to be challenged the old-fashioned way, and in order to do that, challengers will need access to information about how decisions were made in drawing maps.But transparency in redistricting is the exception, not the rule.One thing the states we reviewed have in common is that the public map-drawing process was largely a charade. Emails and documents that subsequently emerged showed the real drawing was done behind closed doors by party operatives and consultants.In Wisconsin, for instance, the maps were drawn at a law firm associated with the Republican Party, and vetted by the Republican National Committee before anyone in the general public was even allowed to see them. View note In North Carolina, the maps were also drawn at a non-government site and a wealthy donor was allowed to see drafts and offer input.In Texas, Republicans in the state legislature turned to consultants operating in secret.As more donor money flows into the process and mapmaking tools get more sophisticated, the importance of map drawing in the public eye will only become more important, said the Brennan Center’s Li.Regardless of the outcome of Gill v. Whitford, experts say it will be important for the public to have a detailed picture of the redistricting process. That goal, they say, can only be achieved when the map drawing process is truly public.“If communities aren’t being heard, or shut out, if a redistricting plan is rammed through or rushed,” Aden said, “That is a step that needs to be exposed.”
Electionland Wins Online Journalism Award
by ProPublica ProPublica and the Electionland coalition won an Online Journalism Award for planned news/events, announced at the Online News Association Conference and Awards Banquet on Saturday.A collaboration with a coalition of organizations — including Google News Lab, Univision, the USA Today Network, the CUNY Graduate School of Journalism, WNYC, First Draft and student journalists from 12 colleges and universities — Electionland tracked voter experiences in real time, across thousands of polling sites. With more than 1,100 participating journalists, local newsrooms were alerted to reports of problems such as long lines, provisional ballots, and voter intimidation unfolding at their local precincts; national partners and their readers received an unprecedented, nationwide look at problems facing the vote.Specially trained students scoured national social media, looking for problems at polling places with special emphasis on states with histories of election administration issues. Google News Lab provided tools and expertise to help track search trends related to voting issues (Disclosure: It also provided some project funding). The Election Protection Coalition allowed Electionland to feed the data from their nationwide call center into a database as calls came in. The team also communicated with voters directly, checking in with more than 120,000 people who had signed up to text Electionland about their voting experiences.As Electionland partners collected these tips, professional journalists vetted them, forwarding them as real-time leads to the national news desk and to local reporting partners across the country. Instead of reporting on a patchwork of precincts, local journalists were given the tools to target polling stations facing clear problems.Despite President Trump’s warnings about the election being rigged, and his later claims that massive in-person voter fraud cost him the popular vote, the Electionland coalition saw no evidence of widespread fraud.Following Electionland’s successful coverage of the vote in 2016, partners have continued to build on the lessons of the collaboration. First Draft launched Crosscheck (another OJA winner), which brought together newsrooms in France to cover the 2017 election, while ProPublica launched Documenting Hate, a national project bring together newsrooms to create a repository for hate crimes and self-reported hate incidents across the U.S.See the full list of Online Journalism Award winners here.
Vegas Judge Featured in ProPublica Story Reprimanded for Ethics Violations
by Megan Rose A former Las Vegas prosecutor whose misconduct in a wrongful murder conviction was detailed in a ProPublica and Vanity Fair story in May has been rebuked again, this time for his conduct as a judge.The Nevada Commission on Judicial Discipline publicly reprimanded Judge William Kephart in August for violating four ethics regulations. The sanction did not include any fine or discipline, but was posted online. ProPublica’s story focused on the case of Fred Steese, a drifter convicted of murdering a Vegas trapeze artist-turned-trained poodle performer. Kephart, known as “Wild Bill,” led the prosecution. Nearly 20 years later, Steese was proved innocent after exculpatory evidence was found in the prosecution’s files.In an accompanying story, we described how the Supreme Court of Nevada had noted prosecutorial misconduct in at least five of Kephart’s cases over a dozen years, including instances in which he choked a witness on the stand and downplayed the reasonable doubt standard by telling a jury they needed only a “gut feeling.” In 2002, Kephart was fined $250 by Nevada’s high court for a “violation of the Rules of Professional Conduct.” Although at the time Kephart promised the justices that there wouldn’t be “a bona fide allegation of prosecutorial misconduct against me in the future,” he was again called out for bad behavior in 2008 when the court tossed out a murder conviction.Despite these cases, Kephart moved on to the bench, eventually winning a seat on the city’s Eighth Judicial District in 2014. His term is up in 2020. Listen to the Podcast Hear ProPublica reporter Megan Rose discuss her reporting about Alford pleas and the case of Fred Steese. Kephart’s newest sanction involves his comments on a 2002 case in which he prosecuted Kirstin Lobato for murder. The case later became nationally known for its meager evidence against the then 19-year-old and was picked up by the Innocence Project. In February 2016, Lobato had a pending appeal before Nevada’s Supreme Court when Kephart gave a media interview in which he said the case “was completely justice done.” His comments prompted an inquiry and subsequent judicial misconduct charges, because asserting her guilt while she had an ongoing innocence claim “could affect the outcome or impair the fairness of Miss Lobato’s case,” according to the formal statement of charges.The commission announced the charges in May and Kephart denied wrongdoing — saying in part that his “character and reputation” should be a mitigating factor. But he later conceded that he had broken the ethics rules and agreed to the reprimand. Neither Kephart or his lawyer, William Terry, responded to requests for comment. Nor did a spokesman for the Eighth Judicial District.Lobato was subsequently granted an evidentiary hearing by the state’s high court that is scheduled to begin today.
The Breakthrough: How a Reporter Uncovered Widespread Russian Meddling — In the Olympics
by Joaquin Sapien In the spring of 2016, a Russian government chemist named Grigory Rodchenkov sat across from Rebecca Ruiz of The New York Times and gave her the kind of scoop journalists dream of.He told Ruiz and her colleague Michael Schwirtz how he helped orchestrate the covert distribution of steroids to dozens of the country’s top athletes. Russia went on to win 33 Olympic medals at the 2014 Winter Games in Sochi — more than any other country. At least a third of the medal winners were linked to the elaborate doping scheme. Listen to the Podcast Rodchenkov told the reporters how he created what he called the “Duchess Cocktail,” a drink made of three anabolic steroids mixed with alcohol — vermouth for women, whiskey for men — at amounts tailored to meet the needs of each individual athlete. When it came time to test the athletes during the Olympics, Russian agents replaced tainted urine samples with clean ones in the dead of night through a hole in the wall of a testing laboratory.Ruiz paraphrases the scientist’s nonchalant admission: “Yes, we stockpiled all of the top Olympians’ urine for months,” she remembers hearing. “And yes, we broke into these bottles, which are the gold standard … which are thought to be tamper proof. And this is how we won the most medals at Sochi by far. And we’re very proud of that.” How Russia Hid Its Doping in Plain Sight A World Anti-Doping Agency report alleges widespread, widely accepted doping in track and field. It was a climactic moment in a long, nerve-wracking reporting effort. In the end, more than 1,000 Russian athletes were implicated across 30 sports.Rodchenkov is living in witness protection in the U.S. Last week, the Times reported that a Russian court issued an order for his arrest if he were ever to return to his home country.Ruiz tells the whole story on today’s episode of The Breakthrough, the ProPublica podcast where investigative reporters reveal how they nailed their biggest stories.
For-Profit Schools Reward Students for Referrals and Facebook Endorsements
by Heather Vogell Lyla Elkins transferred to North Nicholas High School in Cape Coral, Florida, in 2016 with hopes of sailing through its computer-based courses and graduating early. She didn’t realize the for-profit charter school would also be a source of income: a $25 gift card each time she persuaded a new student to enroll.“I referred almost all of my friends,” said Elkins, 17, who earned three gift cards. She also won a Valentine’s Day teddy bear in a raffle for sharing one of the school’s Facebook posts.Such incentives are rampant among for-profit operators of public alternative high schools like North Nicholas, which serves students at risk of dropping out. These schools market aggressively to attract new students, especially during weeks when the state is tallying enrollment for funding purposes. They often turn their students into promoters, dangling rewards for plugs on social media, student referrals or online reviews, a ProPublica-USA Today investigation found. Some also offer valuable perks simply for enrolling.The schools’ reality is often less inspiring than their promotions. While they face a daunting mission of salvaging students who struggled elsewhere, they’re characterized by high absenteeism, low graduation rates, little instruction from teachers and few extracurricular activities or elective classes. Their intensive recruitment, when coupled with poor outcomes, “is wrong on so many levels,” said Samuel E. Abrams, a professor at Columbia Teachers College and author of a 2016 book on for-profit education. “It’s not addressing the pedagogical needs of these kids.”It’s legal for schools to provide gift cards to students for referrals, and free electronic devices, such as tablets or computers, to newcomers. And students are free to express their opinions on their schools. But advertisements have less protection under the First Amendment, and some for-profit school promotions involving online posts or reviews may violate federal consumer safeguards.According to the Federal Trade Commission, companies that use students and other groups as social media marketers should instruct them to disclose publicly that they expect to be paid. In settlements with the FTC, companies that failed to encourage such disclosures have agreed to follow the law — or face a potential penalty of up to $40,000 per transgression. Those instances didn’t involve students.Even a series of seemingly small awards should be acknowledged to help viewers assess the credibility of an online endorsement, said Mary Engle, FTC associate director for advertising practices. “Our advice is to err on the side of disclosure,” she said.More companies are using “micro influencers” like students for marketing, because they are inexpensive and effective at targeting consumer groups, said Bonnie Patten, executive director of the nonprofit watchdog Truth in Advertising.“Basically, the law says if it’s an ad, consumers need to be able to clearly and conspicuously see it’s an ad,” she said. “For a group of unsophisticated teenage kids, the onus is definitely on the company to require them to disclose this material connection.”During its “Share the Love Facebook Contest” in February, North Nicholas offered raffle prizes such as the bear Elkins won, a $50 gift card grand prize, $25 gift cards, flowers and chocolates. To enter, students needed only to “Like, Comment AND Share” a post from the charter school’s Facebook page. Charter schools are publicly funded, but independently run.“Remember to share a post every day for more chances to win!” the school urged. It didn’t say on the post, or tell Elkins separately, that students should disclose that they hoped to be rewarded.Angela Whitford-Narine, president of the for-profit company that runs North Nicholas, Accelerated Learning Solutions, said schools handle their own social media pages and ALS does not believe it is obligated to make disclosures in individual schools’ online posts. But, she said, the company will consult its attorneys in response to ProPublica’s inquiry.North Nicholas’ promotion took place during a week when Florida education officials require schools to count heads to determine how much money they should receive. At least 17 states, including Florida, use this “snapshot” method to allocate public education dollars. Whitford-Narine said ALS hosts social events throughout the year — not just during count weeks. Those weeks are busy recruitment periods for other for-profit chains too. One alternative school in St. Lucie County, Florida, managed by Acceleration Academies, used Facebook to encourage students not to “miss out on the food, fun and raffles” between Jan. 30 and Feb. 10 — a period that overlapped with the state’s enrollment count. It touted “Pizza Monday” and “Pizza Thursday,” “Taco Tuesday,” and “Wing Wednesday.”David Sundstrom, chairman of the board for Acceleration Academies, which is based in Chicago, said in an email that such social events take place year-round and are not just a way to drum up enrollment. “Bottom line,” he wrote, “we don’t use pizza parties etc. as a mercenary means to exploit the kids we serve, or to make money.”Another Acceleration Academy offered a pricey incentive to new students — free electronics. “As a graduation candidate at Polk Acceleration Academy, you’ll receive your own Kindle Fire HD to access your course content,” the school’s 2014 Facebook post said. Acceleration schools no longer provide Kindle Fires for newcomers, Sundstrom said, although some give away technology devices to students for achieving academic goals.Refer-a-friend programs like the one at North Nicholas are common in the sector. “Bring a friend into Mavericks!” said one 2015 Facebook post for a Palm Springs school in the for-profit Florida charter chain. “They will get help getting their diploma and you will get a gift card.” The post promised a $5 gift card for each referral as part of the “Friends & Family Club,” as long as the recipient had acceptable attendance and no disciplinary problems.Mavericks’ new parent company, EdisonLearning, hands out Walmart gift cards for student referrals at its “Bridgescape” schools in Illinois and Ohio. It posted pictures on Facebook this past spring of students displaying their prizes. EdisonLearning officials said the gift cards enable low-income students to buy essentials.In some cases, schools have offered rewards to students for online reviews. In April, Invictus High School in the Cleveland suburb of Parma Heights promised students a $25 gift card for a review on Yelp, an arrangement it promoted on Facebook. Invictus, which was run by a for-profit manager until November 2016, didn’t instruct students to disclose the benefit.Joe Palmer, the school’s principal, said it didn’t end up paying any students for reviews. This year, it’s changing its advertising strategy. “We’re moving away from any recruitment strategies that aren’t focused on driving students through word of mouth,” he said.
Who’s Really in Charge of the Voting Fraud Commission?
by Jessica Huseman On Friday, in response to a judge’s order, the Department of Justice released data showing the authors, recipients, timing, and subject lines of a group of emails sent to and from the Presidential Advisory Commission on Election Integrity. They show that in the weeks before the commission issued a controversial letter requesting sweeping voter data from the states, co-chair Kris Kobach and the commission’s staff sought the input of Hans von Spakovsky and J. Christian Adams on “present and future” state data collection, and attached a draft of the letter for their review — at a moment when neither had yet been named to the commission.The commission’s letter requesting that data has been by far its most significant action since its formation in May — and was widely considered a fiasco. It sparked bipartisan criticism and multiple lawsuits. Yesterday, a state court blocked the state of Texas from handing over its data due to privacy concerns.The involvement by Adams and von Spakovsky, both Republicans, in drafting the letter even before they were nominated to the commission shows their influence. Von Spakovsky previously raised eyebrows after documents from February showed him lobbying against the inclusion of Democrats on the commission.The sway of Adams and von Spakovsky starkly contrasts with that of other members, who say they have largely been sidelined. A Democratic commissioner, Matt Dunlap, the secretary of state of Maine, expressed frustration with what he said was a “clear” imbalance of power. “Von Spakovsky has a profound influence on this commission,” he said. “I never expected to be at the head of the table, but I’m not even sure I’m sitting at the table.” Dunlap questioned “who the chair of the commission really is. Is it the vice president of the United States, [Mike Pence is the titular co-chair of the commission], or is it Hans von Spakovsky, working in the shadows?”The letter was sent to states on June 28, hours after the conclusion of the commission’s first conference call with Kobach and Pence. Kobach used the call to inform commissioners of his intention to send the letter. But he said nothing that suggested it had already been written, according to Dunlap, nor did he mention the involvement of Adams or von Spakovsky.The content of the letter was discussed only in generalities, Dunlap asserted. Commissioners expressed concerns that they hadn’t seen the actual text, he said, but Kobach assured them that only his signature would be on the missive. Dunlap said he then received a copy of the letter shortly after the call, which surprised him.Von Spakovsky and Adams were not appointed to the voting commission until June 29 and July 10, respectively. Both appointments caused immediate criticism among voting rights advocates. The two men are known for their belief that voter fraud is rampant, and both have a history of advocating laws that critics say would restrict access to voting. Von Spakovsky headed the Heritage Foundation’s election initiatives, and worked for the Justice Department during the administration of George W. Bush. While there, he helped spearhead ultimately unsuccessful efforts to uncover voter fraud and was criticized for writing an article warning of the dangers of voter fraud under a pseudonym.Adams also joined the Justice Department during the Bush administration. He resigned in 2010 and accused the department of being unwilling to bring cases on behalf of white voters. He now runs the Public Interest Legal Foundation, which regularly sues counties to force them to purge voter rolls of inactive registrations.The email data that revealed the roles of Adams and von Spakovsky was released as a result of a lawsuit against the Commission by the Campaign Legal Center. The Department of Justice had contended that the emails — which were circulated between Kobach, von Spakovsky, commission staffer Andrew Kossack and the Office of the Vice President’s counsel — are confidential because they contained communications between commissioners.That stance puzzled Justin Levitt, a professor at Loyola University School of Law and former Department of Justice civil rights official. “At the time, they were private individuals, not members of the commission,” he said. “This is not how you run a legitimate commission that is attempting to, through a neutral process, get information to inform deliberations.”Neither the White House, Kobach nor von Spakovsky responded to a request for comment. Adams declined to respond to questions asked by email. “You’ve had a hard time reporting accurately, and thus I have nothing for you,” he wrote.So far, nearly 20 states have submitted at least some data sought by the commission. It remains unclear how many of the remaining states will ultimately comply with the request. Multiple state elections officials responded to the letter with questions of their own, which have been met with silence. For example, John Merrill, the secretary of state for Alabama, asked the commission specifically how the data would be used. Kobach has provided no response so far, according to Merrill. Kobach also did not answer the same question when it was posed to him by members of the press at commission meetings in July and September. In a July interview, Marc Lotter, then the spokesperson for the Pence, said that the commission planned to check the rolls against “a number of different databases,” but did not specify which databases or how this match would be done. The email data offers clues to both, though the filing contains only data and not the text of the emails.First, it shows the commission has received proposals from “third party data analysis entities,” though no further details are offered. It also reveals that the commission has been in contact regarding “potential future coordination” with the Department of Homeland Security, which maintains data on people moving through the immigration process. Emails regarding data sent to the Social Security Administration, which maintains records on deceased individuals, are also listed. Kobach has previously expressed interest in obtaining information on immigrants and dead people who are still registered.This is not the first time von Spakovsky’s actions prior to his appointment have caught the attention of critics. Last month, the Campaign Legal Center released a letter received from a public records request that showed von Spakovsky had sent a February email that was forwarded to Attorney General Jeff Sessions. In it, von Spakovsky lobbied for specific members (whose names were redacted) and lamented the inclusion of Democrats on the commission. “There isn’t a single Democratic official that will do anything other than obstruct any investigation of voter fraud and issue constant public announcements criticizing the commission and what it is doing, making claims that it is engaged in voter suppression,” he wrote. (In the most recent batch of email traffic, there are further messages from von Spakovsky and Adams, before they joined the commission, in which they appear to be opining on who else should be permitted to join it.)At the commission’s September meeting, Kobach said he was unaware of anyone expressing these sentiments directly to him, and that he would “laugh” at the idea that Democrats shouldn’t be included because federal law requires bipartisan participation on such commissions. “So whoever authored that email obviously wasn’t acquainted with the law,” he said.
Wells Fargo Offering Refunds Nationwide for Improper Mortgage Fees
by Jesse Eisinger In a scandal that extended wider than was previously known, Wells Fargo said it would offer refunds to tens of thousands of customers who were improperly charged fees on home mortgages.ProPublica first reported earlier this year that the bank was chiseling customers by making them pay to extend interest rates on loans even when the delays were the bank’s fault. Current and former employees said at the time that the practice was especially prevalent in the Los Angeles area and Oregon. As it turns out, about 10 percent of the affected mortgages were in those two regions, and the rest were scattered nationwide, according to a person familiar with the issue. A Wells Fargo spokesman did not immediately return a call for comment.As is typical in home loans, Wells Fargo allowed customers to lock in a promised mortgage rate for a given period of time. When a deadline for mortgage paperwork was missed, a fee would be incurred. Even when the bank was responsible for the delay, management frequently forced loan officers to blame the customers and charge them. The fees were typically about $1,000 to $1,500, depending on the size of the loan. Wells Fargo estimates that about 110,000 borrowers between Sept. 16, 2013, and February 28, 2017, were assessed $98 million in mortgage interest-rate-lock extension fees. Without specifying the number of victims, it said that not all of those customers were charged improperly. Before Sept. 16, 2013, the bank had paid all rate-lock extension fees.The bank has been conducting an internal review, and has let go several top mortgage executives. The Consumer Financial Protection Bureau’s investigation into the practice continues.Wells Fargo has been dogged by numerous scandals, regulatory action and Congressional scrutiny in recent years. In September 2016, it was fined $185 million for illegally opening as many as 2 million deposit and credit card accounts without customers’ knowledge.
Join ProPublica’s New Project to Work With Local Newsrooms
by ProPublica Over the past several years, economic pressures have reduced the ability of local and regional news organizations to support accountability reporting. That’s a challenge not just for journalism, but also for our democracy.We’re committed to helping address that problem.Earlier this year, we launched ProPublica Illinois, an initiative we hope to replicate in additional states in the coming years. Today, we’re announcing another part of our push: the ProPublica Local Reporting Network.With support from a new three-year grant, we will pay salary plus an allowance for benefits for one full-time reporter dedicated to investigative work throughout 2018 at each of up to six partner news organizations in cities with population below 1 million. The reporter will still work in and report to their home newsroom, but they will receive extensive guidance and support from ProPublica. Their work will be published or broadcast by their home newsroom and simultaneously by ProPublica as well.If you lead a newsroom and are interested in working with us, send us a proposal laying out:
ProPublica Creates Local Investigative Reporting Project for Regional Newsrooms
by ProPublica In an effort to support investigative journalism at local and regional news organizations, ProPublica today announced the ProPublica Local Reporting Network. The yearlong initiative will pay salary, plus an allowance for benefits, for reporters at up to six partner news organizations in cities with populations below 1 million.Over the past several years, accountability journalism has been shrinking and underfunded at the local and regional levels. As newspapers grapple with budget constraints and drastically cut their reporting staff, attention wanes on areas of possible corruption.The ProPublica Local Reporting Network aims to address this problem by giving local reporters the opportunity to tackle big investigative stories that are crucial to their communities. The reporters will still work in and report to their home newsrooms, but they will receive extensive support and guidance from ProPublica throughout 2018. In addition to news organizations receiving the one-year grant, reporters will collaborate with a ProPublica senior editor, and ProPublica’s expertise with data, research and engagement will be made available for the work.“The economic pressures facing local and regional newsrooms across the country are challenges not just for journalism, but also for our democracy,” said ProPublica President Richard Tofel. “Our local reporting initiative has the same mission as ProPublica overall: to spur change through stories with moral force.”Each investigation from the ProPublica Local Reporting Network will be published or broadcast by both the reporter’s home newsroom and ProPublica. In a similar collaboration with the New York Daily News in 2016, one of the News’s reporters, Sarah Ryley, worked on a project about the NYPD’s abuse of nuisance abatement laws, which had police kicking people out of their homes without due process. ProPublica helped to develop the work, edit it and dig deeper into the data. The collaborative series led to sweeping legislative reforms, and ultimately won the 2017 Pulitzer Prize for public service.Also this year ProPublica announced ProPublica Illinois, a Chicago-headquartered newsroom that will produce investigative journalism to expose wrongdoing across the state of Illinois. It is expected one of the members of the ProPublica Local Reporting Network will be from Illinois.Eligible newsrooms are invited to apply for the ProPublica Local Reporting Network by Nov. 3. Winning entries will be announced in December, to enable work to begin on Jan. 2. More information on the project and application process can be found in this post.
ProPublica is Hiring a Senior Editor to Lead our New Regional Reporting Project
by ProPublica We have just announced a new initiative to help local and regional news organizations produce the kind of accountability reporting that is so vital for our democracy.With support from a new three-year grant, the ProPublica Local Reporting Network will pay for one full-time reporter dedicated to investigative work throughout 2018 at each of up to six partner news organizations in cities with population below 1 million. The reporter will still work in and report to their home newsroom, but they will receive extensive guidance and support from ProPublica. Their work will be published or broadcast by their home newsroom and simultaneously by ProPublica as well.We are hiring a senior editor to lead our work on the project. She or he will have the responsibility to guide, edit and elevate the work. As with all our work at ProPublica, the job is ultimately to create compelling investigations that spur change.What you would be doing:
For-Profit Schools Get State Dollars For Dropouts Who Rarely Drop In
by Heather Vogell COLUMBUS, Ohio — Last school year, Ohio’s cash-strapped education department paid Capital High $1.4 million in taxpayer dollars to teach students on the verge of dropping out. But on a Thursday in May, students’ workstations in the storefront charter school run by for-profit EdisonLearning resembled place settings for a dinner party where most guests never arrived.In one room, empty chairs faced 25 blank computer monitors. Just three students sat in a science lab down the hall, and nine more in an unlit classroom, including one youth who sprawled out, head down, sleeping.Only three of the more than 170 students on Capital’s rolls attended class the required five hours that day, records obtained by ProPublica show. Almost two-thirds of the school’s students never showed up; others left early. Nearly a third of the roster failed to attend class all week.Some stay away even longer. ProPublica reviewed 38 days of Capital High’s records from late March to late May and found six students skipped 22 or more days straight with no excused absences. Two were gone the entire 38-day period. Under state rules, Capital should have unenrolled them after 21 consecutive unexcused absences.Though the school is largely funded on a per-student basis, the no-shows didn’t hurt the school’s revenue stream. Capital billed and received payment from the state for teaching the equivalent of 171 students full time in May.U.S. Secretary of Education Betsy DeVos has championed charters and for-profit education, contending in congressional testimony that school choice can lower absenteeism and dropout rates. But at schools like Capital, a ProPublica-USA Today investigation found, the drop-outs rarely drop in — and if they do, they don’t stay long.Such schools aggressively recruit as many students as possible, and sometimes count them even after they stop showing up, a practice that can generate hundreds of thousands of dollars in taxpayer-paid revenue for empty desks. Auditors have accused for-profit dropout recovery schools in Ohio, Illinois and Florida of improperly collecting public money for vanished students. State officials in Ohio have twice chided Capital over indications of inflated enrollment numbers.Told of ProPublica’s findings, both Ohio’s state auditor and its Department of Education said they would investigate Capital. EdisonLearning conceded extended absences are a “persistent challenge,” but said it shares all student attendance records in “real time” with state education officials. If issues arise, the company said, it addresses and corrects them.The school’s program director, Monica Scott, defended her school’s efforts to combat truancy, saying during a tour of the school that its “lockstep protocols for absences” include calls, visits and letters to parents. She said she urges students, who often have difficult home lives, to come to class. “I’m telling them you have to get your instructional hours,” she said.For those who arrive but head for the door shortly after, she added: “I do try to stop them.”Corey Timmons, 19, who graduated from Capital this spring, said he had complained to Scott about students coming and going as they pleased. Those who did show up often goofed around on their phones or got into arguments. “It’s not really a school environment,” he said.Monica Scott, program director for Capital High, says she tells students they must come to class, but that at times she’s allowed them to “flex a little bit more” because of home and work commitments. (Andrew Spear for ProPublica) Across the nation, roughly 6 percent of young people ages 16 to 24 are considered dropouts because they neither attend high school nor hold a diploma. Many more teeter on the brink of leaving. Their challenges include homelessness, domestic violence, bullying and learning disorders. They fall off the degree track by failing too many courses or skipping too many days.Facing pressure over graduation rates and test scores, regular high schools often don’t want these students. But they’re welcome at publicly funded alternative schools.So-called “dropout recovery” schools are increasingly popular, with many setting up shop in poverty-stricken city neighborhoods. In Chicago this past year, about 8,000 students attended such schools. In Ohio in the 2014-2015 school year, more than 16,000 students did, including some who attended online-only programs.For-profit school management companies like Capital’s parent, EdisonLearning, have rushed into this niche, taking advantage of the combination of public funding, an available population of students and lax oversight.EdisonLearning and other for-profits sometimes sign contracts with local school districts to manage these dropout recovery schools. In Ohio and a few other states, though, companies have often operated them as charter schools, which are publicly funded but independently run. Nationwide, as of 2014, just 5 percent of all students attended charters, while 17 percent of alternative school students did.Using call centers and other corporate tactics typically shunned in secondary education, the for-profit schools market and recruit intensely. They prod guidance counselors at traditional schools to send them failing students. They offer gifts and financial inducements to prospective students, as well as to pastors and current students who help reel in newcomers.After pulling in students long enough to tap public money, many of the schools fail to keep them in class. In Ohio in 2016, for-profit companies ran nearly one-third of the state’s 94 charter schools for dropouts — but three-fourths of the 20 with the highest absenteeism rates.“They were trying to get the children in, but didn’t know what the needs were,” said Monique Newburn, a former EdisonLearning special education teacher who worked at one of its dropout recovery schools in Chicago.And like Capital, many dropout recovery schools rely on low-cost, computer-based academic programs. Critics say such software allows students, without much guidance from teachers, to “show up a couple of times to make up what took 18 weeks” of regular instruction, said Walt Gardner, a former teacher in Los Angeles who writes about education. “Something is not right here.”The sector’s practices, from call centers to online courses, are reminiscent of for-profit colleges. For years, the colleges have faced criticism over their use of aggressive tactics to hook minority and low-income students. They rake in public money despite their soaring dropout rates, questionable educational quality and failure to deliver the lucrative post-graduation jobs they promise.EdisonLearning and its competitors say their curriculum and instruction are well-designed to help borderline students earn diplomas and avoid the devastating consequences associated with quitting high school, such as lifelong unemployment and underemployment. Even detractors acknowledge that rescuing dropouts is difficult work, and a high rate of failure is likely.Yet dropout recovery schools like EdisonLearning’s have incentives to inflate enrollment counts. Unlike traditional schools, they seek out the most unreliable students. They must hustle to attract enough enrollees, while traditional schools get a steady stream of kids from their residential zone. During surprise visits, Ohio’s state auditor found the gap between reported and observed enrollment was far greater in dropout recovery schools than in traditional schools. In 2015, auditors found, for-profits ran five of the seven dropout recovery schools with the biggest discrepancies.Ohio doesn’t have education money to spare for ghost students: This year’s state budget froze or cut funding for most school districts. In 2011, NBA Hall of Famer Earvin “Magic” Johnson signed on to spread word of EdisonLearning’s newest enterprise: A chain of eight dropout recovery schools it had opened in Ohio the year before.Johnson visited EdisonLearning schools and touted them in press conferences. Advertising urged students to “Join Magic’s Team” and included local events, ads on bus benches and direct mail — along with local radio, television and print spots. The company hung signs branding the schools “Magic Johnson Bridgescape” academies.“I want to tell you about an option that you have that will help you earn a diploma and a more successful career,” Johnson told radio listeners in Cleveland. “Let me help you achieve your dreams.”For EdisonLearning, the move to dropout recovery schools signaled a remarkable downshift in ambition. When launching the Edison Project 25 years before, media executive Chris Whittle and former Yale University President Benno Schmidt held out privatization as a fix for urban schools’ ills, as well as the future of American education. At its height, Edison managed dozens of schools in cities across the country, including Philadelphia and Baltimore.Whittle and Schmidt left their administrative roles in December 2006. Money troubles and controversies over test scores, staffing and safety forced the company to scale back, redirecting its efforts to running small public schools aimed at high school dropouts.By 2013, the Bridgescape program had expanded to 17 schools in six states. It secured a plum contract in Chicago, joining other contractors in running “options” schools in some of the city’s most desperate neighborhoods.To drum up enrollment, EdisonLearning supplemented on-air marketing with grassroots recruiting. It canvassed distressed neighborhoods and sent employees into traditional high schools to persuade guidance counselors to refer struggling students, said former EdisonLearning marketing manager Heather Hoffman.Such strategies came up in a 2016 conference call on enrollment, according to an internal PowerPoint obtained by ProPublica. It recommended weekly “outreach to former schools of enrolled students (referrals).”Hoffman said the efforts had mixed results. They succeeded more often in Ohio, which allowed traditional high schools to remove from their ledgers the test scores of students who transfer to charter schools. The pitches were less effective in Illinois, which held traditional schools accountable for students’ performance even after they switched to Bridgescape. With no benefit from letting students go, Chicago schools fought to retain students and the per-pupil funding they brought. Former NBA star Earvin “Magic” Johnson signed a five-year licensing agreement with EdisonLearning to promote its Bridgescape schools. Magic was featured in print, radio and television ads for the company. (Reed Saxon/AP Photo) In a statement, EdisonLearning denied that it ever carried out the strategy described by Hoffman and the PowerPoint, saying that “there has been no outreach to traditional schools” to boost enrollment. The company said there have been cases of counselors reaching out to Bridgescape to see if one of its schools was a good fit for a student. Contacts that Bridgescape initiated with former students’ schools consisted mainly of requests for documents and transcripts, it said.Courting counselors at traditional schools is a strategy that other companies in the industry have used, too. “Visit counselors before the winter break and bring a gift,” said a document obtained by ProPublica that was shown to employees at the Florida for-profit charter chain Accelerated Learning Solutions several years ago. “Take goodie bags on special occasions (Bosses Day, Counselors Week, etc.).” The document also suggested reminding traditional school staff that transferring poor-performers to ALS would raise the graduation rate.In an email, ALS President Angela Whitford-Narine said ALS schools get referrals because of their reputation for helping students graduate. Gifts, she said, “are things like an occasional delivery of donuts and coffee” for school staff when ALS employees stop in with new promotional materials or updates on enrolled students.Some schools have turned reliably attending students into marketers, offering rewards for posting plugs on social media, referring friends or writing positive online reviews. This spring, Ohio Bridgescapes awarded students gift cards for referring new enrollees and maintaining high attendance themselves. The company posted photos on Facebook of smiling students holding their prizes.In Chicago, like other dropout school managers in major cities, EdisonLearning made connections with politically powerful African-American pastors on the city’s South Side who helped with recruitment — including organizing door-to-door campaigns. EdisonLearning paid some ministers thousands of dollars for their efforts, said Hoffman, the former marketing manager.The company said that while a retired pastor in Chicago had served as an enrollment coordinator and worked on recruiting in neighborhoods, it was an “unfortunate misrepresentation” that EdisonLearning paid pastors to help it attract students.Like many for-profit colleges, EdisonLearning also hired a call center to pursue leads. When it received the phone number of a parent or someone else who had shown interest — often through a website inquiry, Hoffman said — the Pittsburgh-based call center’s employees would call three times a day for 45 days before marking the lead cold.John Kuhn, a former Chicago Bridgescape teacher, said the recruiting tactics by some for-profit dropout recovery schools made him queasy. “It shouldn’t be a thing where we have to aggressively market them,” he said.A PowerPoint presentation last fall showed EdisonLearning’s intense focus on how many taxpayer dollars each student brought in. In one slide, company leaders estimated an increase of 108 students over five locations — including its Ohio virtual school — would capture $889,646 more a year. Each Chicago student would bring in another $10,000 per year, and each Ohio student, $7,500. A slide from another PowerPoint referred to Ohio’s monthly enrollment reporting deadlines as “pay dates.”In Ohio, EdisonLearning jockeyed with competitors for potential dropouts. The state had become well-known for loose charter regulation, with controversial players like White Hat Management lobbying against stricter controls. According to a report by two academics tracking the industry, more students attended for-profit charters in Ohio than in any state but Florida and Michigan — DeVos’ home state.In this crowded field, EdisonLearning wasn’t attracting as many at-risk students as it had hoped, documents show, and there were early signs some of its schools were inflating enrollment. At Capital High in 2012, auditors found 90 percent of former students in a sample had not been withdrawn in “a timely manner.” (Withdrawn students are free to re-enroll.) Two other Bridgescapes returned nearly a half-million dollars to the state that year after it questioned their enrollment reports.EdisonLearning acknowledged that, in the early stages, “both the academic and operational aspects of the schools were not meeting our expectations.”Tenice Rogers, who worked as an office manager at Capital, said she tracked student attendance and took care to follow state rules, including that students be unenrolled after missing 105 hours (or 21 days for schools with five-hour sessions). “When they hit it, I withdrew them,” she said. If students showed up the next day, she said, “they had to re-enroll.” When students walked out long before the day’s session ended, she noted their absence, too.But other employees at the school thought she should be more forgiving of partial absences — despite the state’s instructions, she said. “A lot of people felt like if a student showed up for two hours, they should get full credit,” she said. No one told her to change her practices, she said, but she sensed disapproval. “I’d let them know,” she said, “‘If you want it done this way, you’ve got to find someone else to do it.’” In 2013, the company downgraded her job description to secretary. Where she had been making $35,000 a year, she would make $10 an hour instead. She couldn’t afford what amounted to a substantial pay cut and left for a job at Provost Academy, EdisonLearning’s virtual school in Ohio. Asked whether she felt the demotion was related to how she handled attendance, Rogers replied, “It might have been.”EdisonLearning said: “It would be highly inaccurate and inappropriate to portray this situation as anything other than an adjustment of staffing resources.”After Rogers left, concerns about Capital’s enrollment reporting resurfaced. In 2014, state auditors made unannounced visits to 30 charter schools across Ohio, and found some alarming differences between the number of students actually sitting in seats and the claimed enrollment levels.Dropout recovery schools fared the worst in the survey, leading the auditor to warn they were at an “increased risk” of inflating student counts. After a second visit the next year, State Auditor Dave Yost again suggested low attendance might be a sign of exaggerated enrollment figures. “Fifty percent and under doesn’t pass the smell test for me as a taxpayer,” he said. He chastised the state education department for weak oversight.In 2014, Capital High was among seven schools with the largest variances between its reported enrollment and actual attendance. Scott told auditors that about 70 students attended daily, with the rest rotating in and out just often enough not to be withdrawn. EdisonLearning said that auditors in Ohio and Chicago — who also challenged Bridgescape’s numbers — at times have not grasped its schools’ unique challenges and nontraditional schedules.An internal EdisonLearning document obtained by ProPublica raises more questions about whether Capital overstated its students in reports to the state. A company spreadsheet charting withdrawals and enrollments in 2015-2016 shows that, on average, the student totals Capital submitted monthly for funding exceeded its internal tally by at least 24 percent.Because enrollment is constantly changing, “a single snapshot of enrollment and withdrawals will more than likely not match” state totals, the company said. A recent state review praised Capital for “excellent” attendance procedures, but noted that students who never showed up in the fall had still been reported as enrolled. “I know I’m meeting the expectations,” said Scott, the program director.Yost, the state auditor, said Ohio needs better security measures to prevent dropout recovery schools from manipulating enrollment data. “It’s just clear that the honor system of ‘trust us’ is not really working all that well,” he said. Capital High is part of for-profit EdisonLearning’s Bridgescape chain, which seeks out students who have already dropped out or are about to. The charter school is publicly funded, but privately run. A third of students were absent the entire week when ProPublica visited. (Andrew Spear for ProPublica) Located in a weathered strip mall on Columbus’ high-poverty West Side, Capital High occupies a one-story storefront with mirrored plate-glass windows. Students sign in at a counter, on a sheet preprinted with their names, before walking through a metal detector. Officially, the first shift begins at 7:30 a.m., the second at 11.The central hallway and the classrooms off it feature the subdued blues, greens and grays of Bridgescape’s logo. There are no sports teams, band or orchestra, or art classes, but the school stages its own prom and takes students on occasional field trips.“It’s so normal in urban areas that their world is so small,” said Scott, whose left arm bears an ankh tattooed above the word “balance.” “We work super hard to try to make it as rich as possible.”While the school employs seven teachers and offers some small classes, most students are supposed to work for the full five hours on computers.Timmons, the recent graduate, said the software at Capital often had typos and glitches. “Most of the online courses were very misleading,” he said. “If you asked the teachers about it, they would say, ‘We didn’t make it, just Google the questions and do the best you can.’”Many students wouldn’t bother reading the questions on the short multiple-choice tests required to advance in a course, he said. Instead, “they would keep clicking till they got it right,” he said.EdisonLearning officials said there have been “few incidences” of typos in its software and that the company corrects them when schools report them. Teachers “lock” tests after three attempts, they said, and have students work one-on-one or in small groups.Juvenile probation officers in Franklin County, where Capital is located, have formed negative impressions about some of the dropout recovery schools — which many of the teenagers they supervise attend. The officers visit the schools to meet with those students or check on their attendance and academic progress.“We have a couple good programs here and a couple of not-so-good programs,” said Diane Mueller, chief probation officer for the juvenile court. “Clearly anything that’s more structured is helpful for the kids.” By that, she said she means students are expected to arrive and leave at certain times, and teachers are available.“I think all of our POs have concerns about the charter schools,” she said.Ohio’s Department of Education defines “chronic absenteeism” as missing more than 10 percent of the school year for any reason. During their time at Capital, all but four of the 502 students enrolled at some point during 2015-2016 met that threshold.Matthew Knight’s attendance record is typical. Around noon on that Thursday in May, his mother, Lisa Brandon, dropped him off in Capital’s parking lot. A shy 15-year-old who was placed in gifted classes as an elementary student, he started cutting classes at his traditional public high school and then refused to go at all, complaining he was being bullied and some students reeked of marijuana, his mother said.He enrolled at Capital in the fall of 2016. About six months ago, the family became homeless, Brandon said, making it hard for her son to get to school. She said that since October, he’d missed “45 to 50” days. “A whole month of time we did not go to school,” she said.Knight told his mother that he had a guidance counselor’s permission to keep up from home by logging in online. In fact, Capital doesn’t have state approval for such an arrangement. A county social services counselor soon warned her that Knight was considered truant and needed to start physically attending school immediately.Capital had robocalled her, Brandon said, but hadn’t made a personal call or sent a letter to her mother’s mailing address, which she provided. “I felt like they dropped the ball a little bit by not saying, ‘He’s truant, why is he not here?’” she said.Brandon has since made extra efforts to take Knight to school. But he doesn’t stay full days. She said he typically calls her an hour or two after she drops him off, or walks to an aunt’s house. “He gets to leave when his assignments are done,” she said. “I guess it is easy for him.”Scott said her desire to make school accessible to students with commitments at work and home has led her to “allow them to flex a little bit more.” Some leave to eat, and one insists on going home to use the bathroom.“A lot of students have different specialized schedules,” she said. “It’s hard to keep track of it.”Being flexible also means liberally granting “excused” absences, records show. They reset the clock, enabling Capital to legally bill the state for students who miss more than 21 consecutive days of school. In April, the school marked 13 percent of absences as excused.Scott made improving attendance a goal in an annual school performance review in 2015-2016. “Ensure staff is meticulously charting absences,” the document said, “and communicating with students and families to decrease unexcused absences.” Knight, who entered Capital at the age of 14, also illustrates a controversial tactic that the school increasingly depends on to boost enrollment and state reimbursement — enrolling younger students.The school’s charter contract allows Capital to enroll students in grades 9-12 “and/or” ages 16-21. After denying Capital had any students under 16, EdisonLearning later conceded some were 14 or 15.Scott said the state allows 12 percent of Capital’s students to be under 16. But she said she often tells young students they will miss out on experiences like homecoming if they leave traditional high schools. “These kids want instant coffee,” she said. “I push them back because, ‘Give it a chance.’”Educationally, mingling younger teens with students in their early twenties may be unwise. A state task force report in July on dropout recovery programs warned that a broader age span could pose problems because “the developmental difference between 14-year-olds and 21-year-olds may be too great.”But with students departing in droves — 337 students withdrew, while just 270 enrolled during the 2015-2016 school year — Capital can’t afford to limit itself. EdisonLearning officials acknowledged that they’re worried about attrition, and said their efforts to retain students “far outweigh” their attention to recruitment.Former Chicago Bridgescape teacher Kuhn said most of the younger students lacked the maturity to complete hours of lessons independently on computers.“Anyone who came in as a freshman or sophomore had a really long way to go,” he said. “I wasn’t hopeful for their future at our school.”State regulators often set a lower academic bar for alternative schools than regular ones. But Ohio’s 94 dropout recovery schools have struggled even to attain less rigorous goals.About 40 percent of the schools failed to meet state standards in 2015-2016. While Capital High passed overall, meeting state testing and other goals, its students didn’t make satisfactory academic progress. At 92 percent of Ohio’s dropout recovery schools in 2015, the graduation rate was below 50 percent. Capital’s was 23 percent. In 18 schools, including Capital, students skipped at least once every two days.Beginning this fall, new rules will make it easier to shut down dropout recovery schools that repeatedly fail, said Aaron Churchill, Ohio research director for the Thomas B. Fordham Institute, which oversees some Ohio charters. Because their students bring so many challenges with them, dropout recovery schools are hard to evaluate, he said.“I don’t think we’ve got it completely perfect on how to hold dropout recovery accountable,” Churchill said. “I think that’s one of the issues Ohio and other states need to work out.”The state task force recommended adding new criteria for schools such as attendance and course progress, and having traditional and dropout recovery schools share accountability for students. Ohio education officials said the state is also requiring new intervention plans for students who miss too many days.In the summer of 2016, EdisonLearning ended its partnership with Magic Johnson and removed his name from schools’ signs. Officials with the company and Magic Johnson Enterprises said the five-year agreement “mutually concluded.”“Mr. Johnson was personally committed to the Bridgescape program,” Magic Johnson Enterprises said in a statement, “and proud of the success the vast majority of students showed in their educational growth.” Johnson even pledged to pay personally for one Chicago Bridgescape graduate’s college education, the company said.EdisonLearning — which sold off a chunk of its business in 2013 — posted a significant loss in the 2016 fiscal year and has closed Bridgescapes in Illinois, Ohio and Virginia.But it is still bullish on dropout education. In January, according to a company press release, it “doubled the size of our Alternative Education portfolio,” buying a chain of six for-profit charters in Florida called Mavericks in Education. Mavericks has been investigated in recent years for problems that included overstating attendance numbers. Sabrina Blevins says many students haven’t stayed in the program. “There’s a lot of kids, they just disappear,” she said. (Andrew Spear for ProPublica) At Capital High on that unseasonably hot Thursday, students drifted out early in the afternoon. One was Sabrina Blevins, 18, who came to Capital as a sophomore when she had a hard time keeping her grades up at her previous high school.Blevins showed up at noon and left around 1:30 p.m., carrying a packet of algebra worksheets to her car. She usually leaves early for her full-time job at McDonald’s — though on this afternoon, she was off work. “PM is pretty chill,” she said.Blevins has missed school for weeks at a time: “I’ve hit the limit a couple of times.” But she always came back without having to re-enroll, and hopes to graduate in December, she said, adding, “There’s a lot of kids, they just disappear.”
Chamber of Secrets: Teaching a Machine What Congress Cares About
by Jeremy B. Merrill If you asked congressional experts what legislative subjects, say, Sen. Patty Murray of Washington specializes in, they’d have a few pretty good guesses: maybe education and health care — because she’s the ranking member on a key committee that oversees those issues. If you asked who else in the Senate shares her interests, you might hear Sen. Michael Bennet of Colorado. Why? Because he is a former school superintendent and a member on that same committee.You could ask them the same question about more members of Congress, but before you got through all 535 lawmakers, they’d probably hang up on you.But what if we could teach a computer what specific topics are distinctive to each member? We did just that. We trained a computer model to extract what phrases a Congress member uses more than the rest, using hundreds of thousands of press releases from 2015 to the present.We hope this addition to Represent’s member pages will give constituents new insight into what the people who work in their names specialize in, whether it’s hot-button national issues or local happenings.Many of the results are intuitive: Rep. Jared Polis, a Democratic representative from Colorado who is known as a civil libertarian, has “email privacy” as a topic; the model also knows Sen. Mitch McConnell, the Kentucky Republican, talks often about “coal miners.”But the model’s strength is not in making obvious observations, but spotting things others might not. The model has picked up on New Jersey Democrat Rep. Josh Gottheimer’s use of the phrase “moocher states,” for example, a phrase more closely associated with libertarian groups than his own party. And the model recognizes Rep. Yvette Clarke’s interest in “confederate generals,” as it relates to street names in Fort Hamilton, near her Brooklyn, New York, district.The model notices issues that aren’t quite on the national radar, like the “wotus rule” — AKA, the Waters of the United States Rule, a change in who regulates water pollution that has raised the ire of Republicans such as Rep. Bob Gibbs of Ohio. Or widespread interest among representatives of the rural West, including Sen. Mike Enzi of Wyoming and Rep. Rob Bishop of Utah, about whether to add the sage grouse to the endangered species list, triggering rules that could limit farming and industry near the bird’s habitat.Just because a topic appears on one member’s list but not another’s doesn’t mean the second Congress member don’t care about it. There may simply be more distinctive topics that they talk about. And for now, that means big topics that lots of representatives and senators talk about, such as education or crime, aren’t included in each member’s list. But we’re working on ways to reflect those, too.Along with identifying discrete topics, the model finds which members of Congress’ press releases are most similar, in topic or turns of phrase, in essence calculating who “sounds like” whom.The representative whose press releases are closest to Rep. John Lewis’ is Rep. A. Donald McEachin, another African-American Democrat from a southern state. Rep. Thomas Massie, the model says, puts out releases similar to Sen. Rand Paul, his fellow Kentuckian who also leans libertarian.How the Model WorksOur code relies on an approximation of what English words mean created by mathematically representing the context in which they occur. The theory that this would give you an idea of words’ meanings is called “Distributional Semantics.”Why the particular technique we use, called Word2Vec, works so well is a bit of a mystery — especially if you, like me, never studied linear algebra — but it does work. Without being explicitly programmed to know anything about U.S. politics, the model has learned a lot about how our country works:
ProPublica Illinois Hires Jane Nicholson as Director of Development
by Cynthia Gordy ProPublica Illinois announced today that Jane Nicholson is joining its staff as director of development. She starts on Oct. 10 and will work closely with the ProPublica fundraising team to help build and implement a sustainable development strategy in Illinois.Nicholson comes to ProPublica Illinois from Chicago Public Media/WBEZ, where she has served as manager of institutional giving for nearly four years. As the frontline fundraiser and portfolio manager for the organization’s institutional giving program, she managed donor relations and cultivated, solicited and stewarded major gifts – securing the largest project-focused grant in WBEZ’s history. Prior to this role, Nicholson held development and sales positions for Koahnic Broadcast Corporation and A&E Television Networks.“Jane’s broad experience and successful track record will be essential as we continue to grow our newsroom,” said ProPublica Illinois Editor-in-Chief Louise Kiernan. “We’re thrilled to have her dynamic fundraising talent on our team.”"The high-impact investigative journalism that ProPublica delivers is vital to the health of our society," said Nicholson. "I am honored and enthusiastic to join such a talented, visionary team and look forward to engaging with those in our community who embrace and seek to advance ProPublica's important mission."
Ivanka and Donald Trump Jr. Were Close to Being Charged With Felony Fraud
by Jesse Eisinger and Justin Elliott, ProPublica, and Andrea Bernstein and Ilya Marritz, WNYC In the spring of 2012, Donald Trump’s two eldest children, Ivanka Trump and Donald Trump Jr., found themselves in a precarious legal position. For two years, prosecutors in the Manhattan District Attorney’s office had been building a criminal case against them for misleading prospective buyers of units in the Trump SoHo, a hotel and condo development that was failing to sell. Despite the best efforts of the siblings’ defense team, the case had not gone away. An indictment seemed like a real possibility. The evidence included emails from the Trumps making clear that they were aware they were using inflated figures about how well the condos were selling to lure buyers. In one email, according to four people who have seen it, the Trumps discussed how to coordinate false information they had given to prospective buyers. In another, according to a person who read the emails, they worried that a reporter might be onto them. In yet another, Donald Jr. spoke reassuringly to a broker who was concerned about the false statements, saying that nobody would ever find out, because only people on the email chain or in the Trump Organization knew about the deception, according to a person who saw the email.There was “no doubt” that the Trump children “approved, knew of, agreed to, and intentionally inflated the numbers to make more sales,” one person who saw the emails told us. “They knew it was wrong.”In 2010, when the Major Economic Crimes Bureau of the D.A.’s office opened an investigation of the siblings, the Trump Organization had hired several top New York criminal defense lawyers to represent Donald Jr. and Ivanka. These attorneys had met with prosecutors in the bureau several times. They conceded that their clients had made exaggerated claims, but argued that the overstatements didn’t amount to criminal misconduct. Still, the case dragged on. In a meeting with the defense team, Donald Trump, Sr., expressed frustration that the investigation had not been closed. Soon after, his longtime personal lawyer, Marc Kasowitz entered the case. A view of the Trump SoHo hotel and condominium building. (Drew Angerer/Getty Images) Kasowitz, who by then had been the elder Donald Trump’s attorney for a decade, is primarily a civil litigator with little experience in criminal matters. But in 2012, Kasowitz donated $25,000 to the reelection campaign of Manhattan District Attorney Cyrus Vance Jr., making Kasowitz one of Vance’s largest donors. Kasowitz decided to bypass the lower level prosecutors and went directly to Vance to ask that the investigation be dropped.On May 16, 2012, Kasowitz visited Vance’s office at One Hogan Place in downtown Manhattan — a faded edifice made famous by the television show, “Law & Order.” Dan Alonso, the chief assistant district attorney, and Adam Kaufmann, the chief of the investigative division, were also at the meeting, but no one from the Major Economic Crimes Bureau attended. Kasowitz did not introduce any new arguments or facts during his session. He simply repeated the arguments that the other defense lawyers had been making for months.Ultimately, Vance overruled his own prosecutors. Three months after the meeting, he told them to drop the case. Kasowitz subsequently boasted to colleagues about representing the Trump children, according to two people. He said that the case was “really dangerous,” one person said, and that it was “amazing I got them off.” (Kasowitz denied making such a statement.)Vance defended his decision. “I did not at the time believe beyond a reasonable doubt that a crime had been committed,” he told us. “I had to make a call and I made the call, and I think I made the right call.”Just before the 2012 meeting, Vance’s campaign had returned Kasowitz’s $25,000 contribution, in keeping with what Vance describes as standard practice when a donor has a case before his office. Kasowitz “had no influence and his contributions had no influence whatsoever on my decision-making in the case,” Vance said.But less than six months after the D.A.’s office dropped the case, Kasowitz made an even larger donation to Vance’s campaign, and helped raise more from others — eventually, a total of more than $50,000. After being asked about these donations as part of the reporting for this article — more than four years after the fact — Vance said he now plans to give back Kasowitz’s second contribution, too. “I don’t want the money to be a millstone around anybody’s neck, including the office’s,” he said. Manhattan District Attorney Cyrus Vance Jr. (Andrew Burton/Getty Images) Kasowitz told us his donations to Vance were unrelated to the case. “I donated to Cy Vance’s campaign because I was and remain extremely impressed by him as a person of impeccable integrity, as a brilliant lawyer and as a public servant with creative ideas and tremendous ability,” Kasowitz wrote in an emailed statement. “I have never made a contribution to anyone’s campaign, including Cy Vance’s, as a ‘quid-pro-quo’ for anything.”Last year, The New York Times reported the existence of the criminal investigation into the Trump SoHo project. But the prosecutor’s focus on Ivanka and Donald Jr. and the email evidence against them, as well as Kasowitz’s involvement, and Vance’s decision to overrule his prosecutors, had not been previously made public. This account is based on interviews with 20 sources familiar with the investigation, court records, and other public documents. We were not able to review copies of the emails that were the focal point of the inquiry. We are relying on the accounts of multiple individuals who have seen them.Requests for interviews with Ivanka Trump and Donald Trump Jr. were referred to Alan Garten, the chief legal officer of the Trump Organization. In an emailed response, Garten did not address a list of questions about the criminal case. Instead, he quoted the company’s filings in civil litigation relating to the Trump SoHo, which described complaints as “a simple case of buyers’ remorse.”But even a lawyer in the Trump camp acknowledges that the way the case was resolved was unusual. “Dropping the case was reasonable,” said Paul Grand, a partner at Morvillo Abramowitz who was part of the Trump SoHo defense team. “The manner in which it was accomplished is curious.”Grand, who was a partner of Vance’s when the district attorney was in private practice, said he did not believe that the D.A.’s office had evidence of criminal misconduct by the Trump children. But the meeting between Vance and Kasowitz “didn’t have an air you’d like,” he said. “If you and I were district attorney and you knew that a subject of an investigation was represented by two or three well-thought-of lawyers in town, and all of a sudden someone who was a contributor to your campaign showed up on your doorstep, and the regular lawyers are nowhere to be seen, you’d think about how you’d want to proceed.”In June 2006, during the season finale of “The Apprentice,” Donald Trump Sr. unveiled the Trump SoHo as a visionary project. The luxury development was intended to mark the ascension of Ivanka and Donald Jr. — then 24 and 28 years old, respectively — as full players in the Trump empire. They signed the licensing deal alongside their father, and photographs of Ivanka were featured in the Trump SoHo’s advertising, under the tagline “Possess your own SoHo.”Their partners on the project included two Soviet-born businessmen, Felix Sater and Tevfik Arif, who ran the Bayrock Group, a real estate development firm. Sater had a history of running afoul of the law. In 1993, he was convicted of assault and spent about a year in prison for attacking a man with the stem of a margarita glass in a bar fight. In 1998, he pleaded guilty to one count of racketeering for his role in a $40 million securities fraud scheme.The Trump SoHo was beleaguered from the start: Named for one of Manhattan’s trendiest neighborhoods, the development wasn’t really in SoHo, but located just west of it, near the entrance ramp to the Holland Tunnel. Zoning laws wouldn’t allow a residential tower at the location, so the Trumps fell back on an alternative: a “condo-hotel,” in which buyers got a hotel room rather than an apartment, and were legally prohibited from staying there more than 120 nights per year. Worse, the high-priced condos hit the market in September 2007, just as the global economy began to crater in what became the largest financial crisis since the Great Depression.Business was slow, but the Trump family claimed the opposite. In April 2008, they said that 31 percent of the condos in the building had been purchased. Donald Jr. boasted to The Real Deal magazine that 55 percent of the units had been bought. In June 2008, Donald Jr. and Ivanka, alongside their brother Eric, gathered the foreign press at Trump Tower in Manhattan, where Ivanka announced that 60 percent had been snapped up. “We’re in a very fortunate position,” she said, “where we have enough sales and now we are strategically targeting certain buyers.” Ivanka Trump, Eric Trump and Donald Trump Jr. stand before the new Trump SoHo Hotel Condominium rendering during a news conference in New York on Sept. 19, 2007. (Jennifer Altman/Bloomberg via Getty Images) None of that was true. According to a sworn affidavit by a Trump partner filed with the New York attorney general’s office, by March of 2010, almost two years after the press conference, only 15.8 percent of units had been sold.This was more than a marketing problem. The deal hinged on selling at least 15 percent of the units. By law, the sales couldn’t close with anything less. The Trumps and their partners would have had to return the buyers’ down payments.Some buyers concluded that they’d been cheated. In August 2010, some sued the Trump Organization and others involved in the project in New York federal court. “This action seeks to redress the substantial and ongoing pattern of fraudulent misrepresentations and deceptive sales practices” by the Trumps and the other defendants, the suit charged. The plaintiffs argued that there’s a vast difference in value between a unit in a building that is 15 percent sold and one that is 60 percent sold. Their complaint accused the sellers, including the Trumps, of “a consistent and concerted pattern of outright lies.”After the civil suit was filed, the Manhattan district attorney’s office opened a criminal investigation. Prosecutors are often wary of getting involved in a dispute between wealthy litigants. But in this instance, according to a person familiar with their thinking, the lawyers in the Major Economic Crimes Bureau quickly concluded that there was enough to warrant an investigation. They believed that Ivanka and Donald Jr., might have violated the Martin Act, a New York statute that bans any false statement in conjunction with the sale of a security or real estate. Prosecutors also saw potential fraud and larceny charges, applying a legal theory that, by overstating the number of units sold, the Trump were falsely inflating their value and, in effect, cheating unsuspecting condo buyers.Peirce Moser, an assistant district attorney known for his methodical, comprehensive investigations, soon took over the case. “He is not a cowboy,” Marc Scholl, who spent almost 40 years as a prosecutor in the district attorney’s office, said. “He is certainly not out to make headlines for himself or to advance himself.”On the other side, the Trumps’ defense team included Gary Naftalis and David Frankel, of the law firm Kramer Levin; Paul Grand represented one of the real estate brokers who had worked with the Trumps. Marc Kasowitz addresses the media on June 8, 2017, in Washington, D.C. (Ricky Carioti/The Washington Post via Getty Images) As the investigation progressed, Vance suffered an embarrassing setback in one of his highest profile cases. In the summer of 2011, his office had abandoned a sexual assault case against the former managing director of the International Monetary Fund, Dominique Strauss-Kahn. Vance, who was pummeled in the press afterward, denied in his interview with us that the case made him reluctant to take on another prominent defendant.A few months later, on Jan. 11, 2012, Marc Kasowitz contributed $25,000 to Vance’s campaign, unbeknownst to prosecutors in the Major Economic Crimes Bureau, who continued their work. Moser was particularly focused on email correspondence, according to seven people familiar with the case.The prosecutors began considering impaneling a special grand jury, according to a person familiar with the investigation. That would have represented a significant escalation in the case, because it is often a prelude to indictments. With a grand jury in place, defense lawyers knew the risk of indictment was high.The defense team offered a deal to stave off this possibility, floating the possibility of a settlement of some kind, including a deferred prosecution agreement, which would have meant the corporate equivalent of probation for the Trump Organization. With the investigation appearing to gather momentum, Naftalis and Grand, who had already met with the prosecutors twice, began to step up their campaign against the case. Grand calls this the “internal appellate process.” Particularly when well-heeled or high-profile defendants are involved, there can be a multi-month advocacy process that slowly makes its way up the hierarchy inside the Manhattan D.A.’s office.Grand and Naftalis decided that it would be unwise to go over the heads of the staff prosecutors. Instead, on April 18, 2012, they sent a letter to Adam Kaufmann, then chief of the investigative division (he’s now in private practice), outlining their arguments. The next day, the defense lawyers met with Moser, Kaufmann, and others from the prosecution team. The defense team acknowledged that the Trumps made some exaggerated statements in order to sell the units. But this was mere “puffery”— harmless exaggeration. Such language, they contended, didn’t amount to criminal conduct. The Trumps weren’t selling useless swampland in Florida. The condos existed. And the buyers’ money was in escrow the entire time.The defense lawyers argued that bringing such a case to trial would be wasteful and that resources would be better spent on more serious offenses. As Grand put it to us during our recent interview, “I guess in a world that is completely pure and where there is no deviation between propriety and the law, that kind of exaggeration and deliberately concentrated exaggeration can be pursued. But is that the kind of criminal law enforcement the D.A. should be doing?”Moser’s answer seemed to be “yes,” and he found support among his supervisors. Moser had prepared an elaborate PowerPoint presentation, featuring dozens of emails that prosecutors believed showed that Ivanka and Donald Jr. had repeatedly lied to buyers. “You couldn’t have had a better email trail,” a person familiar with the investigation told us.At the meeting, Kaufmann peppered the defense team with questions, at one point raising his voice, according to a person who was there. “I believed in the case,” Kaufmann told us, though he declined to discuss the evidence. “But believing in the case doesn’t mean we had reached the point when [I had] settled on what should happen with the case.”White-collar criminal cases are often challenging to bring because of their complexity. And, by the time of the April meeting, prosecutors knew that they faced another impediment, this one created by legal maneuvers in the Trumps’ civil case. Five months earlier, the Trumps and their partners had reached a settlement with the disgruntled buyers. The defendants agreed to return 90 percent of the buyers’ deposits, plus their attorneys’ fees. But they extracted a rare concession in return: The plaintiffs agreed not to cooperate with prosecutors unless they were subpoenaed. (Garten, the Trump Organization’s chief legal officer, noted that the settlement terms were confidential and declined to comment on them.)Adam Leitman Bailey, the attorney for the buyers, had been helping prosecutors. Now he provided aid to the Trumps, writing a letter to the district attorney that stated: “We acknowledge that the Defendants have not violated the criminal laws of the State of New York or the United States.” In our interview with Vance, he said he had never before seen a letter where plaintiffs in a civil case asserted that no crime had been committed. “I don’t think I’d ever received a letter like it,” Vance said. He calls it a “significant and important” communication.Certainly, prosecutors could subpoena the buyers of Trump condos. But they feared the witnesses would undercut the criminal case by claiming they weren’t victims of a fraud.Still, Moser, backed by his supervisors, persisted. “Peirce believed in his case,” Grand said. “We did not succeed in talking him out of it and didn’t succeed in talking one or two levels above him into dropping the case.”Finally, in the spring of 2012, Kasowitz joined the case. His involvement “came from out of the blue,” Grand told us. He and the other lawyers assumed Kasowitz intervened at the request of Donald Trump Sr.In early May 2012, Kasowitz asked to see the District Attorney. Vance told us such meetings aren’t unusual — but his investigations chief at the time, Kaufmann, characterized Kasowitz’s request as “a little premature.” The Trump lawyer was going over the heads of everyone who had been working on the case. The gathering, on May 16, lasted 20 to 30 minutes, according to Vance. Kasowitz repeated the arguments the defense team had made before.Afterward, Kasowitz didn’t seem to think his clients were in the clear. On Aug. 1, he suggested a settlement, proposing that the Trump Organization would not admit to wrongdoing but would agree not to mislead people in the future and would submit to outside monitoring. The offer proved unnecessary. Two days later, on Aug. 3, 2012, Moser called the Trumps’ defense attorneys and told them prosecutors were dropping the investigation. (Moser, who still works for Vance, now as senior investigative counsel, did not respond to requests for an interview made over multiple months. Shortly before this article was published, he sent an email stating that Vance’s ultimate decision in the case “was not unreasonable” and that throughout the process, the D.A. asked “smart questions” and expressed “reasonable skepticism.”) Employees stand outside the Trump SoHo in February 2017. (Drew Angerer/Getty Images) In his interview, Vance defended his decision to drop the case with no conditions, even after Kasowitz offered a deal. “This started as a civil case,” Vance said. “It was settled as a civil case with a statement by the purchasers of luxury properties that they weren’t victims. And at the end of the day, I felt if we were not going to charge criminally, we should leave it as a civil case in the posture in which it came to us.”In September 2012, within weeks of the case being resolved, Kasowitz contacted Vance’s campaign about hosting a fundraiser, according to a spokesperson for the campaign. Kasowitz held the event that January. He personally donated almost $32,000 to Vance’s campaign, and 20 of his law firm’s partners and employees kicked in at least another $9,000. Then, in October 2013, as Election Day approached, he hosted a breakfast —“Republicans for Cy Vance” — which raised an additional $9,000.Vance defended his decision to accept the money Kasowitz sent his way. “We did the right thing,” he said, referring to the decision to drop the case. “Another five and a half months go by. Marc Kasowitz has no matter pending before the office for the Trumps or anybody else. It’s 2013 and it’s an election — and I welcome his support.” Vance noted that New York law allowed him to accept such a contribution. Still, he now intends to return the money to Kasowitz.Ivanka Trump is now an adviser to the president, with an office in the West Wing. Donald Jr. is running much of the family empire while his father is in the White House. Kasowitz attained national prominence when he was retained to represent the president in the Russia investigation, only to be supplanted as lead counsel. Vance is running unopposed for reelection in November. The Trump SoHo went into foreclosure in 2014 and was taken over by a creditor. Only 128 of the 391 units in the building have sold. That comes out to around 33 percent.
Texas Official After Harvey: The ‘Red Cross Was Not There’
by Justin Elliott, Jessica Huseman and Decca Muldowney The Red Cross’ anemic response to Hurricane Harvey left officials in several Texas counties seething, emails obtained by ProPublica show. In some cases, the Red Cross simply failed to show up as it promised it would.In DeWitt, a county of 20,000 where Harvey ripped apart the roof of a hotel, Emergency Management Coordinator Cyndi Smith upbraided a Red Cross official in a Sept. 9 email:“Red Cross was not there as they were suppose[d] to be with the shelter and again no communication to what this is actually about and that you have been in DeWitt County doing anything.”With fewer than 24 hours’ notice, Micah Dyer, a school superintendent in DeWitt County, was forced to run a shelter on his own in an unused district building that would eventually house 400 people. For the first three days the shelter was opened, only two Red Cross volunteers were there — neither had any experience running a shelter, Dyer said in an interview.“Every hot meal came from us,” Dyer said. “[School district employees] had to go to our pantries and walk-in coolers and get whatever we could get so people would have food.” Dyer says the Red Cross didn’t appear with supplies until the fourth day of the storm, and didn’t bring enough cots or food for those housed in the shelter, he said. A significant portion of the Meals-Ready-to-Eat the charity did bring had gone bad, he said.The charity contested his account, saying in a statement that it maintained two shelters in DeWitt County — including the one Dyer ran — “and recorded a total of 1,599 overnight stays.”We have only a partial picture of the Red Cross’ response to the massive storm. ProPublica received emails through public records requests from several counties, large and small. But they don’t cover the full swath of the state affected by the storm.Still, the frustration many authorities felt with the Red Cross was striking. Officials in Jefferson County, which contains Beaumont, were so fed up with the Red Cross that they kicked out a charity employee assigned to work with government officials from the headquarters for the storm response.“Everything we asked him to do, I didn't feel was getting done in a timely manner,” said Mike White, Jefferson County’s deputy emergency management coordinator.In Colorado County, west of Houston, a local official told colleagues on Aug. 30 the charity had simply failed to show up at a shelter as promised.“Persons needing intermediate-term shelters have been transferred to the Red Cross Shelter in Sealy. Red Cross approved the shelter, but the promised shelter management teams and the supply trailer never arrived, nor do they know where they went,” Charles Rogers, the county’s emergency management coordinator, wrote.On Aug. 27, two days after Harvey made landfall, the fire marshal of Humble, a small city in the Houston metro area, sent an urgent plea as his city faced severe flooding: Could the Red Cross help to staff a shelter in his area?“I hate to say this but the Red Cross is completely out of resources and have almost no road accessibility,” responded Kristina Clark, an emergency management official in Harris County, which contains Houston. “The best thing I can recommend is to open something and message to your people to bring THEIR OWN food, sleeping bags, clothes, medication, etc.”The Red Cross said in a statement that, overall, it has provided more than 414,000 overnight shelter stays, and with its partners served “almost 3.2 million meals and snacks.” A baby sits with family belongings in a shelter at a furniture store during the aftermath of Hurricane Harvey on Aug. 30, 2017, in Houston, Texas. (Brendan Smialowski/AFP/Getty Images) Providing relief in the wake of the storm was an enormously difficult task. Tom McCasland, Houston’s director of housing and community development, said in an interview that it wasn’t just the Red Cross — but also city and county governments — that didn’t have the resources to respond to the storm. The storm destroyed over 15,000 homes and damaged over 200,000.“No one was prepared for this in terms of magnitude of numbers that showed up” at the George R. Brown Convention Center, one of the major shelters in Houston, McCasland said. “Given the circumstances, I can say that [the Red Cross] worked their hearts out.”Many others singled out the Red Cross for criticism. At a public meeting earlier this month, Houston City Councilman Dave Martin let loose on the charity for being the “most inept, unorganized organization I've ever experienced.”Martin urged Houstonians not to donate. “I have not seen a single person in Kingwood or Clear Lake that's a representative of the Red Cross,” he said, referring to two hard-hit areas. “You know who opened our shelters? We did. You know who sent water and supplies? We did.”In an interview with ProPublica, Martin said he ran into Gail McGovern, the charity’s CEO, in a parking lot several days after Harvey hit. When he raised his concerns to her, Martin said she responded: “Do you know how much we raised with Katrina? $2 billion. We won’t even raise hundreds of millions here.’ I just thought, ‘Really, Gail? That’s your response to me?’”Asked about McGovern’s conversation with the city councilman, the Red Cross said, “We understand his frustration.” The charity said it has raised around $350 million for Harvey.As ProPublica has previously detailed, the charity’s attempts to respond to large disasters in recent years have been harshly criticized by victims, government officials and, in many cases, by the Red Cross’ own staff. Reconstruction efforts after the 2010 Haiti earthquake fell far short of the charity’s public claims. After Superstorm Sandy hit New York in 2012, Red Cross leadership diverted disaster relief resources for public-relations purposes. And after floods in Louisiana, a state official wrote that the Red Cross “failed for 12 days.”While the Red Cross operates largely as a private nonprofit, it was created by Congress more than a century ago and has an officially mandated role to work with the government in providing food and shelter after disasters.As disasters have gotten larger and more frequent, the Red Cross has gotten smaller. Under the nine-year tenure of McGovern, who came from the private sector, the group has had budget shortfalls and cut staff sharply. Local chapters, including in Texas, have been shuttered.The cuts have stripped the charity of experienced disaster management personnel. Under McGovern, the number of paid employees has shrunk from 36,000 in 2008 to just over 21,000 in 2015, according to tax filings. The group sent fewer responders after Harvey than it did after Superstorm Sandy hit the East Coast five years ago. Six days after Sandy hit New York, the charity reported it had “more than 5,000 Red Cross workers” responding to the disaster. Six days after Harvey made landfall, the Red Cross reported “2,300 disaster workers” in Texas. A Red Cross spokesperson told ProPublica the Sandy response was larger because the storm affected 11 states. It also said technology has resulted in the charity becoming “more efficient and effective in our response.”The charity has said it would give $400 directly to households in the most affected areas. But the program has been beset by technical glitches and unexplained denials, according to reporting by NBC News and several Texas outlets. The Red Cross has apologized for the problems.There have also been problems with a Red Cross hotline for disaster victims. The hotline is staffed by employees of a contractor, TeleTech. A staffer at the firm described frequent trouble with a system that was supposed to identify open shelters for those who needed them.“Their programs we use to find shelters for the victims are not working properly, often telling agents that there [are] openings when in fact the shelter is full,” the staffer said. “Victims get there and are turned around and call us back saying that they used the last of their gas, only to be directed to another shelter with the same results.” The staffer requested anonymity for fear of reprisal for speaking to the media.The Red Cross said in response that “shelter populations are changing on a minute-by-minute basis” during disasters, which sometimes results in reported figures becoming quickly out of date.The Red Cross is still in Texas and is also responding to Hurricanes Irma and Maria. Overall, the Red Cross says it has partnered with local agencies to open shelters in eight states, Puerto Rico and the U.S. Virgin Islands.
State Audit Slams New York’s Oversight of Nurses
by Jessica Huseman An audit released late last week by the New York state comptroller’s office found the state’s Education Department, which regulates nursing, failed to investigate top-priority complaints against nurses in the time allowed by law.It also found nurses’ backgrounds were not adequately checked and that they were not properly monitored for criminal behavior after licensure.All of these findings confirm those in a ProPublica investigation into New York’s nursing regulations published in April of 2016. “The report underscores a problem we already knew existed,” said state Sen. Kemp Hannon, who has co-sponsored two bills — one in 2016 and one in 2017 — aimed at correcting problems identified by ProPublica. In 2016, the bill passed the Senate with a single “no” vote but never received a vote in the Assembly. In 2017, the bill passed the Senate unanimously, but the Assembly never proposed a bill or moved on the Senate bill.“The roadblock lies squarely at the hands of the Assembly,” Hannon said. “At some point they have to bow to the need for action.”Assembly member Deborah Glick, who sponsored 2016 legislation similar to the Senate’s, said the Assembly is “working assiduously” towards a bill. She said earlier versions of the legislation did not respect the due process rights of licensed professionals, particularly by allowing regulators to summarily suspend professionals’ licenses before they had a chance to respond in some cases. In other states, regulators have the power to do this when there is an urgent threat to safety.“We understand the critical importance of protecting the public, but we also understand that licensed professionals are entitled to their due process rights,” she said. She said a solution was almost reached this legislative session, but other initiatives “diverted” the higher education committee’s attention. She said she would make it a priority to pass legislation at the start of the next session, which begins in January 2018.Mark Johnson, a spokesman for the comptroller’s office, said that while audits of state departments are routine, ProPublica’s reporting was “a factor” in the decision to investigate nursing regulations.As ProPublica reported, the Education Department relies on nurses to self-disclose misconduct and criminal convictions. In New York, nurses are only required to make these disclosures every three years when they renew their licenses, which the comptroller’s audit noted “[enables] nurses who have been sanctioned to practice in the interim.”“As a result, the Department cannot be assured that all episodes of misconduct are identified properly and in a timely manner, and that nurses who pose a threat to the public’s health and safety are prevented from practicing in New York State,” the audit said.Both the 2016 and 2017 Senate bills, sponsored by Sen. Kenneth LaValle and co-sponsored by Hannon, would have fixed the vast majority of the problems identified by ProPublica and the recent audit. Aimed at all 54 professions licensed by the Education Department, both bills would have allowed the department to summarily suspend the licenses of professionals suspected of extreme misconduct. The measures also defined “moral character” requirements for licensed professions, and required professionals to inform the department of criminal convictions within 30 days.Hannon said he will continue to pursue a solution for the problems referenced in the comptroller’s audit. If the legislature will not act to fix holes in the oversight of all 54 professions licensed by the state, he said he may propose legislation aimed directly at nursing or move to have the regulation of nurses moved from the Education Department to the Health Department, which regulates doctors and physician assistants. New York is the only state in the country that assigns the regulation of nursing to the Education Department.Under the Education Department’s supervision, New York has continued to allow nurses who have harmed patients to retain active nursing licenses.ProPublica’s report highlighted the case of Linda Ansa, a Bronx nurse who the New York Health Department found had nearly killed a 99-year-old nursing home resident by administering 50 times the necessary dose of insulin.Nursing homes in New York are regulated by the Health Department, which penalized Ansa in 2014 before referring her case to the Education Department for action against her license. But more than three years after her case was referred, no action has been taken. Her license remains clear. Neither Ansa nor the attorney who represented her in the Health Department case has responded to requests for comment.The Education Department declined to comment on Ansa’s case and typically declines to answer questions on specific disciplinary actions. A spokesman for the department, Jonathan Burman, said in a statement that all allegations of misconduct are taken “extremely seriously.” He said that the department has “sought legislation to modernize and enhance our authority over licensed professions” for the past two years. “We will continue to work with the legislature to get this important public protection bill enacted,” he said.In a response included in the comptroller’s audit, the Education Department said its budget has not kept pace with its increasing responsibilities. The professions regulated by the Education Department range from nursing to landscape architecture and the number of professions the agency oversees has increased steadily over the decades. According to the audit, receipts from fees collected by the department have risen from $41.5 million in 2010-2011 to $53.5 million in 2016-2017. The department’s appropriation in the state budget, however, has stayed at $45.1 million over the same period. The department also told the comptroller’s office its antiquated computer system made it difficult to efficiently handle its caseload.The state commissioner of education, MaryEllen Elia, has 90 days to report to the comptroller, the governor and the legislature on what steps the Education Department has taken to implement the comptroller’s recommendations.The recommendations include streamlining and more closely tracking investigations, strengthening controls over “moral character” requirements for nurses and researching the best practices of other states.Donna Nickitas is the executive officer of the nursing Ph.D. program at the Graduate Center of the City University of New York. She called the comptroller’s recommendations obvious and said she was “greatly disappointed” that neither the Legislature nor the Education Department had undertaken those improvements over the last year and a half.“[ProPublica] came to the table so long ago with evidence showing other states were far ahead of us,” she said. “In the private sector, they fire people over this.”
Robert Mueller Subpoenas an Associate of the Man Who Hired Michael Flynn as a Lobbyist
by Isaac Arnsdorf The special prosecutor investigating Russia’s interference in the 2016 presidential election has subpoenaed an associate of Gen. Michael Flynn’s Turkish lobbying client. The subpoena, a copy of which was obtained by ProPublica, ordered Sezgin Baran Korkmaz to testify before a grand jury in Washington on Sept. 22.“The grand jury is conducting an investigation of possible violations of federal criminal laws involving the Foreign Agents Registration Act, among other offenses,” a letter accompanying the subpoena stated. The letter is signed by Robert Mueller and Zainab Ahmad, a senior assistant special counsel who specializes in prosecuting terrorism. Korkmaz did not respond to requests for comment. There are no indications of direct links between Korkmaz and Flynn, who briefly served as Donald Trump’s national security adviser. But Korkmaz, 39, is a close ally of Ekim Alptekin, the 40-year-old Turkish businessman who hired Flynn to lobby for Turkish interests shortly before the election. Korkmaz, a Turkish national, said in a radio interview in May that he started as a dishwasher at age 13 and is now bringing hundreds of millions of dollars from the U.S. to Turkey. His company invests in a range of industries in Turkey, the Middle East, the U.S. and Russia, and he has invested in several projects that involve people accused or convicted of crimes.It’s not clear why prosecutors wanted Korkmaz to testify. But one possible explanation is his connection to Alptekin. Investigators are interested in the ultimate source of the money that Alptekin’s company paid to Flynn’s firm, according to a person familiar with the probe. (Representatives for Alptekin, Flynn and Mueller all declined to comment.)Korkmaz and Alptekin are involved in a trade group together and have overlapping business interests. Korkmaz’s company, SBK Holding, is a member of the Turkey-U.S. Business Council, which is chaired by Alptekin. SBK was one of two platinum sponsors of the council’s conference in May 2017 at the Trump hotel in Washington. Both Alptekin and Korkmaz gave keynote speeches at the conference. In his remarks, Korkmaz credited Alptekin for helping him succeed in business. “Where I am now is due to the support of Mr. Ekim,” he said in Turkish.The two men both attended a meeting at the Harvard Club in Manhattan in September 2016, according to a pro-government newspaper columnist who was present. That meeting occurred during the same week in which Flynn met with two Turkish ministers, also in New York, a gathering arranged by Alptekin. At that meeting, they discussed potential plans for the U.S. to hand over Fetullah Gulen, a controversial cleric and opponent of Turkey’s president who lives in Pennsylvania, to Turkey, the Wall Street Journal reported.Alptekin defended his work with Flynn in his speech at the business council in May. “As many of you have read in the media, I hired the Flynn Intel Group in 2016 before the election with a mandate to help me understand where the Turkish-American relationship is and where it’s going and what the obstacles to the relationship are,” Alptekin said. “My aim was to commission independent research and to establish objective facts” to help businesses understand what he views as the threat from Gulen, whom Turkish President Recep Tayyip Erdogan suspects of trying to topple him. The discovery of the lobbying deal with Alptekin, which ultimately generated about $450,000 for Flynn’s firm, helped put Flynn in legal jeopardy because he didn’t initially report his work as a foreign agent to the Justice Department.As for Korkmaz, his business interests are diverse. SBK has “major investments” in the Russian energy sector, a September 2016 announcement by a Turkish government agency said. The company’s website shows operations in Russia but doesn’t specify what they are.The company backed a bid, which was ultimately unsuccessful, for a high-profile infrastructure project in Russia several years ago. In 2014, SBK pursued a major project that was a top priority for President Vladimir Putin at the time. After annexing Crimea, Putin wanted a bridge built over the Kerch Strait to connect Crimea to Russia. SBK signed an agreement to supply $850 million in financing to build the bridge. But the deal went to a company led by Putin’s childhood best friend.Some of Korkmaz’s colleagues and investing partners have come under scrutiny — or worse — by criminal authorities. The U.S. sister company of Korkmaz’s operation, known as SBK Holdings USA, is led by Levon Termendzhyan, a Russian fuel trader with a long rap sheet, according to court records. Termendzhyan has been charged with, but found not guilty of, tax fraud and armed assault. He was convicted of battery in 2013.In an ongoing lawsuit in California Superior Court in Los Angeles, a former SBK Holdings USA employee claimed in a sworn declaration this year that he was told by two people interviewed by Department of Homeland Security investigators that the agents are probing Termendzhyan for money laundering, tax evasion and stolen petroleum. SBK Holdings USA’s lawyer called those accusations “irrelevant and preposterous” in a court filing. (The lawyer declined to comment for this article.) SBK Holdings USA accuses the former employee of embezzling, which he denies. Since 2013, Korkmaz’s SBK has managed $500 million of investments in Turkey from another of Termendzhyan’s companies and from a third American company called Washakie Renewable Energy. The latter is part of a conglomerate controlled by the Kingston Group, a fundamentalist Mormon clan.In 2011, Utah’s then-attorney general called the Kingstons an “organized crime family.” Washakie paid a $3 million fine in 2015 to settle allegations that its biofuels plant collected federal subsidies while failing to produce. In February 2016, federal agents with the Internal Revenue Service, Environmental Protection Agency and Department of Homeland Security raided some of the family’s company offices. The investigation has not resulted in any charges.In a radio interview, Korkmaz said he convinced the Kingstons to invest in Turkey, and Alptekin is on the board of a Kingston entity that invests in Turkey. Kingston Group did not respond to requests for comment.
City Bureau and ProPublica Illinois Partner on Public Meeting Data
by David Eads, ProPublica and Darryl Holliday, City Bureau Public meetings are important spaces for democracy, where any resident can participate and hold public figures accountable. City Bureau's Documenters program pays community members an hourly wage to attend and document public meetings, as a way to inform and engage their communities.How do Documenters know when meetings are happening? It’s not easy. These events are spread across dozens of websites and are rarely available in machine-readable calendar formats like iCal. Events are buried on dozens of websites with inconsistent formatting and information, as shown in these screenshots of the Regional Transportation Authority (top) and the Illinois Labor Relations Board (bottom) websites. To better manage the data, City Bureau and ProPublica Illinois are working together to develop a community open-source project to scrape and store this information in a central calendar. We believe that like Elex, the NPR / New York Times collaboration to make election data easier to work with, joining forces on this data plumbing will yield dividends for City Bureau and ProPublica Illinois. Other organizations and individuals also will find it useful, and having two partners who want the same information for different purposes provides a strong incentive to push the project forward.Because there are so many calendars in so many formats but only one way to actually store the data, the project also provides a great opportunity for people interested in becoming involved in civic data or data journalism, or who just want to learn how they can contribute to an open-source project. It’s the kind of project that offers many discrete tasks that can be split up among a group with varying skills, skill levels and interests.On July 30, we announced a call for coders via social media, City Bureau’s newsletter and direct email alerts to Chicago’s various civic tech organizations. Our plan was to meet every Tuesday between 4-8 p.m. at City Bureau’s South Side newsroom to share skills, learn new techniques and build scrapers to collect times, dates and locations of civic and governmental public meetings in Chicago. Some 48 hours later, we had a growing list of sign-ups and a core group of 10 novice and experienced coders at our first working session.By our third hacking session, four scrapers had been completed and 20 were underway. That same week, the introduction of a code of conduct helped to frame how we would work — in a collaborative, equitable working environment created by our participants in prior weeks. What’s more, one lucky coder left the session with some City Bureau and ProPublica swag.What’s NextThe Public Meeting Aggregator project was started to respond to a journalistic need for one place to find public meetings. Eventually, it will be integrated into a larger civic journalism plan outlined in City Bureau’s June 27 blog post, “Investing in Our Documenters = Investing in Our Community,” which explains how a $50,000 prototype grant from the Democracy Fund and the Knight Foundation will be used over the next eight months to create a digital platform to manage, coordinate, compensate and track City Bureau Documenters. In the short term, we’ll provide space for our volunteer civic coders so they can exchange skills on the open-source public meetings aggregator and City Bureau staffers can plan the best use of its $50,000 prototype grant. The goal: to promote a diverse set of coders, build a unique civic platform and expand the Documenters program to other cities. ProPublica will use the event data to better deploy reporters and to examine issues like the accessibility of public meetings.On Oct. 14, City Bureau will host a “design-a-thon” aimed at designing and vetting a public-facing version of our civic aggregator — complete with a better name for the tool. Much like a hack-a-thon, where coders meet to engage in collaborative computer programming, City Bureau’s design-a-thon is a free day-long event where designers, coders, journalists and community members will work in teams. The goal: to bring together different perspectives and approaches to propose solutions for how to use the event data.Throughout the day, we'll host trainings by local journalists, designers and coders to help fulfill City Bureau's mission to provide a civic service while democratizing skills, creating shared learning environments and encouraging dialogue across communities.For more information on how you can get involved, check out City Bureau’s event page.Want to Get Involved Remotely?We’ll be meeting at City Bureau’s South Side newsroom through September but you can also contribute to the project remotely. How? Sign up to join City Bureau’s Slack (please be sure to say hello in the #introductions channel) and check out the project’s Github page for a primer on the code, issues and pull requests. If you want to take on a scraper, leave us a comment here next to the appropriate public meeting.Not a coder? Check out this spreadsheet of Chicago’s public meetings to help us fact-check. Add public meetings that aren’t listed and/or help us fill out columns by leaving comments; the doc is currently read-only but open to comments from anyone.Want to see a Public Meetings Aggregator for your city? Let us know.
Without Fanfare, Equifax Makes Bankruptcy Change That Affects Hundreds of Thousands
by Paul Kiel For what appears to be decades, the credit rating agency Equifax has quietly layered three more years of tarnish on the credit histories of hundreds of thousands of people who had filed for bankruptcy under Chapter 13.While its competitors, TransUnion and Experian, placed a flag on such histories for seven years, Equifax left it on the reports of Chapter 13 filers who failed to complete their bankruptcy plans for 10.After ProPublica asked about the difference in its policy, the company said it now leaves the flag on for seven years, but refused to say when and why the change was made.The consequences of Equifax’s harsher policy were likely life-changing for some unlucky people. As Experian warns consumers on its website, “having a bankruptcy in your credit history will seriously affect your ability to obtain credit for as long as it remains on your report. It can also affect your ability to qualify for things like an apartment, utilities, and even employment. Even car insurance rates may be affected.” Without knowing why, consumers could have been turned down for apartments because landlords checked their Equifax report rather than those from Experian or TransUnion.Why Equifax’s policy was different is unclear and the company would not address it. But that such a discrepancy had gone unnoticed and unaddressed for so long underscores how lightly regulated the industry is.ProPublica contacted all of the major credit agencies earlier this year as part of our ongoing series on consumer bankruptcy. The policies of TransUnion and Experian were similar: People who filed under Chapter 7, which wipes out most debts, would have a flag on their report for 10 years; those who filed under Chapter 13, which usually involves five years of payments before debts are forgiven, would have a flag for seven.Equifax had the same Chapter 7 policy. But the company had a key difference in its policy for Chapter 13 filers: Those who were unable to complete their five years of payments and had their cases dismissed were saddled with a flag for three additional years.This difference had the potential for widespread impact. About half of Chapter 13 cases are dismissed, usually because debtors fall behind on payments. From 2008 through 2010, 574,000 Chapter 13 cases were filed and subsequently dismissed, according to our analysis of filings. Under Equifax’s policy of keeping the flag on for 10 years, all those debtors would have a flag on their Equifax report through the end of 2017, but not on their TransUnion and Experian histories.“It’s a problem, because you have a disparate treatment of debtors depending on which credit rating agency is reporting,” said Tara Twomey, an attorney with the National Consumer Law Center. “We really need consistent credit reporting for this system to work.”Equifax’s policy also disproportionately affected black consumers, because, as our analysis showed, black debtors are more likely than whites to choose Chapter 13 and have their cases dismissed.ProPublica wrote the company again in July, prior to its recent disclosure that its records had been hacked, laying out the potential impact of its policy on consumers and asking why it differed from competitors. In an email, Equifax spokeswoman Nancy Bistritz-Balkan wrote that the company had “recently modified the length of time for how long a dismissed Chapter 13 bankruptcy remains on file.” Under the new policy, she wrote, “Equifax removes the flag for a Chapter 13 bankruptcy after seven years, regardless of outcome.”She would not say what “recently” meant, only saying, “The change we referenced was not implemented after we received your inquiry.” As to why Equifax made the change, she wrote, “At this time, I do not have additional details about how the change was made.” How the Bankruptcy System Is Failing Black Americans Black people struggling with debts are far less likely than their white peers to gain lasting relief from bankruptcy, according to a ProPublica analysis. Primarily to blame is a style of bankruptcy practiced by lawyers in the South. It might seem puzzling that such a meaningful policy is not governed by law. While some aspects of credit reporting are, others are simply decided among the agencies themselves. Bankruptcy is a mix of the two. Under the Fair Credit Reporting Act, the longest a bankruptcy can stay on someone’s credit report is 10 years. The credit rating agencies have voluntarily decided to treat Chapter 13 cases differently because Chapter 13 typically involves the repayment of some debt, while Chapter 7 does not. Bistritz-Balkan made a point of saying that Equifax’s previous policy had been legal.Initially, Chapter 7 and Chapter 13 have a similar effect on debtors’ credit scores, one that diminishes over time. Bankruptcy is a negative mark on a debtor’s history, but that doesn’t mean that declaring bankruptcy will invariably damage someone’s credit score. In fact, research shows that most people who declare bankruptcy actually see their score rise in the following months. That’s because the typical score is so low that the negative effect of the bankruptcy is outweighed by the positive effect of wiping out debt.According to Zachary Anderson, a spokesman for FICO, the median FICO score for consumers who declared bankruptcy between October 2009 and October 2010, when filings peaked during the Great Recession, was 558 — lower than all but 20 percent of consumers with a credit score.A recent analysis of credit files by Paul Goldsmith-Pinkham, an economist with the Federal Reserve Bank of New York, shows how scores change before and after bankruptcy. In the months prior to filing, as consumers fall deeper into debt, the average credit score plunges. The analysis, using a credit score generated by Equifax that works similarly to a FICO score, found that the average score fell to a low around 520-530, but recovered sharply over the next 6 months, then gradually increased thereafter. Average Credit Scores Plunge Before Bankruptcy, Rise After FICOchart_finalChapter 13 failureChapter 13 successChapter 7bankruptcy case filed4 years before filing15 years after filing510650550500450600700 averagecredit scoreEquifax flagremovedNew York Fed Consumer Credit Panel / Equifax The next noticeable bump was seven or 10 years later, depending on the chapter, when the bankruptcy flags were removed. Consumers’ credit scores then jumped by about 10 points.The consumers with the lowest credit scores, the analysis found, were those who had their Chapter 13 cases dismissed. That would be due, in part, to the fact that they tend to be disproportionately low-income and black, two groups with lower credit scores on average.As we showed in our story about bankruptcy in Memphis, where Chapter 13 dismissals are incredibly common, these debtors can find themselves worse off for having tried bankruptcy. They might be even further behind on their debts after their cases are dismissed, making it harder to re-establish their credit. The effect of a dismissal lasts for years. At the very least, Equifax’s change in how it handles Chapter 13s means that the shadow cast by a past bankruptcy isn’t quite as long.
Chicago’s Bankruptcy Boom
by Paul Kiel and Hannah Fresques This week we published a deep look at why bankruptcy frequently fails to provide relief to black Americans struggling with debt. The story focused on Memphis, Tennessee — the bankruptcy capital of the nation — where black debtors have for generations been funneled into Chapter 13, which usually requires five years of payments most have no chance of making.Debt-laden consumers outside the South overwhelmingly file under Chapter 7, which wipes away most debts, our story and analysis shows.But in recent years, there’s been one big geographic exception: Chicago. In Northern Illinois, Chapter 13 Filing Rates Have Been Rising Steeply in Black Areas Chapter 13 filings per 1,000 residents - black census tracts vs. white census tracts Source: Department of Justice data, ProPublica analysis by Hannah Fresques Because of a boom in Chapter 13 filings, the U.S. Bankruptcy Court for the Northern District of Illinois, which includes Chicago, had more consumer filings in 2015 than any other district in the country.Almost exclusively fueling this rise are residents of the district’s black communities, where the rate of filings has doubled since 2009. This racial disparity isn’t unique to the Chicago area, but there’s hardly anywhere else in the country where the gap is quite so wide. Even controlling for income, the odds of a black debtor in the Northern District of Illinois choosing Chapter 13 instead of Chapter 7 were about four times as high as those of a white debtor. And, as we found nationally, black debtors were less likely to successfully complete their Chapter 13 plans and have their debts discharged.Why this is happening can be traced to the sort of run-of-the-mill financial hit many Americans face: traffic-related tickets. In Chicago, the failure to pay such tickets can result in a suspended driver’s license or impounded car, crucial lifelines to many low-income families.In our analysis, we note that the rise in Chapter 13 filings has mainly been driven by black, low-income debtors unable to pay tickets owed to the City of Chicago. By filing under Chapter 13, these people are trying to keep their cars or licenses. Chapter 13 stops seizures and suspensions as long as debtors can keep up payments, but the data shows that most can’t. We also found that the Semrad Law Firm, also known as DebtStoppers, played an outsized role. The firm’s clients are largely black and overwhelmingly file under Chapter 13. From 2012 through 2015, DebtStoppers accounted for about 40 percent of Chapter 13 filings by debtors who lived in mostly black areas. Semrad did not respond to several requests for comment.Although the attorney fee for a Chapter 13 in the district is a steep $4,000, debtors typically pay very little of that — anywhere from $0 to a few hundred dollars — up front. The rest is paid through the Chapter 13 payments over time. As we detailed in our story, this gives bankruptcy attorneys an incentive to file cases even when their low-income clients’ prospects for debt relief are poor.You can read our story on Memphis, which clearly has implications for Chicago as well, here. Our data analysis both explores the racial disparities in bankruptcy on the national level and more locally in the Memphis and Chicago areas.News applications developer Mike Tigas contributed to this story.
Baltimore’s ‘Kushnerville’ Tenants File Class Action Against Landlord
by Alec MacGillis Tenants of the Baltimore-area apartment complexes owned by Jared Kushner’s real-estate company have brought a class-action lawsuit against the firm’s property management arm over its aggressive pursuit of tenants for allegedly unpaid rent.The lawsuit, filed Wednesday in Circuit Court for Baltimore City, alleges that the management company and related corporate entities have been improperly inflating payments owed by tenants by charging them late fees that are often unfounded and court fees that are not actually approved by any court. This, the lawsuit charges, sets in motion a vicious cycle in which tenants’ rent payments are partly assessed toward the fees instead of the actual rent owed, thus deeming the tenant once again “late” on his or her rent payment, leading to yet more late fees and court fees. Making matters worse, the 5 percent late fees are frequently assessed on principal that includes allegedly unpaid fees, not just the rent itself. Tenants are pressured to pay the snowballing bills with immediate threat of eviction, the suit alleges. Kamiia Warren was sued by a Kushner Companies subsidiary for breaking her lease at the Cove Village complex in Essex, Maryland. (Philip Montgomery for The New York Times) “The routine practice of charging tenants illegal fees combined with filing eviction proceedings against tenants who have paid their rent on time is predatory and destructive to hard-working Marylanders and their families. This is yet another example of corporations profiting from deceptive policies,” said Chelsea Ortega of Santoni, Vocci & Ortega, a Baltimore-area firm that has also brought class-action suits for similar “fee-churning” practices against two other large property management companies in the area. In this case, the firm is working with Brown Goldstein & Levy, a Baltimore firm specializing in civil rights cases, and the Public Justice Center, a civil legal aid office based in Baltimore that has also brought cases against area landlords over similar practices.A spokesman for the Kushner Companies declined to comment on the particulars of the lawsuit. “We will respond to the complaint at the appropriate time in the legal proceedings,” he said.The family-controlled Kushner Companies purchased apartment complexes with about 5,500 units in the Baltimore area as part of a $371 million deal in 2012, and added three more complexes a year later for $37.9 million. After several subsequent deals, the company now manages a total of 15 complexes in the Baltimore area, with a total of close to 9,000 units. Jared Kushner, who was instrumental in the purchases, stepped down as the company’s CEO when his father-in-law, Donald Trump, won the presidency. Kushner has become one of Trump’s senior advisers in the White House.The suit follows a May 23 article jointly published by ProPublica and The New York Times Magazine that detailed the Kushner Companies’ highly litigious dealings with the people who rent its apartments. The company, which shares ownership in some of the complexes with other partners but runs them all through its Westminster Management subsidiary, has brought hundreds of cases against current and former tenants in local courts.Many of the cases involved former tenants who had moved out of the complexes several years prior to the Kushner Companies’ purchase of them. And some involved tenants who possessed clear evidence that they did not owe the money the company claimed, yet were pursued anyway for several years, with late fees and court fees piling on top of the original claims. The article also described shoddy conditions that many tenants contend with at the complexes, including mice, leaky roofs and mold.In response to questions for the May 23 article, the Kushner Companies’ chief financial officer said that its approach when it came to pursuing tenants was in line with industry practices and that it had a fiduciary duty to its ownership partners to collect all money owed by current and former tenants.A subsequent report by The Baltimore Sun last month found that in some cases, Kushner Companies went to even greater lengths: Since 2013, corporate entities affiliated with the company sought the civil arrest of 105 former tenants at the company’s 17 Maryland complexes (it also owns two in the Washington suburbs) for failing to appear in court to face allegations of unpaid rent. Twenty former tenants were in fact briefly detained, the Sun reported.In response to the stories, Maryland’s two U.S. senators and four of its House members, all Democrats, last month sent a letter to Kushner Companies asking for some of the firm’s records. The lawmakers noted that the complexes rely heavily on tenants with Housing Choice (Section 8) rental vouchers, and thus must comply with a host of Department of Housing and Urban Development regulations. The lawmakers demanded, among other things, all notifications from HUD, public housing authorities, inspection companies or local jurisdictions identifying defects in the complexes in the past three years; all complaints from residents about maintenance and repair issues over the past three years; and information regarding the role played by Jared Kushner.One of the two named tenants in the class-action suit filed Wednesday is Tenae Smith. Smith and her partner have lived at Dutch Village, a Kushner-owned complex on the northern edge of Baltimore, since 2009. Last September, water started leaking from the bathroom ceiling whenever it rained. She told the rental office repeatedly in the months following, but no one came to fix it. Finally, during a hard rain in December, she slipped on the wet bathroom floor, and had had enough. She filed a rent escrow claim in court on Dec. 19, seeking to withhold her rent until the problem was fixed. But the city inspector didn’t come to verify the problem until Jan. 11. Dutch Village finally started work on the problem on Jan. 24, just before her Jan. 30 rent escrow hearing. The judge dismissed the case, but Smith kept fighting, insisting on a reduction in rent for the months when the problem went ignored. Then, during a hard spring rain, the patched ceiling leaked again, suggesting the problem was with the roof.Smith, who has two young children, has been in court countless times this year, arguing for her rent escrow claim and against Dutch Village’s suits demanding payment of her $795-per-month rent. Her family has also been dealing with bedbugs, a leaky sink and mold in the utility closet.The class-action suit alleges that Dutch Village at various points charged Smith with fees for “writ filing” and “legal-summons” ranging up to $80 even though no court had awarded such fees. If Smith did not pay all of the fees along with her rent, Dutch Village sometimes rejected her rent payment, leading to yet more fees. For instance, when she paid her $795 rent for this past July, it rejected the payment and said she in fact owed $944.70 because of accumulated fees, a sum that would grow with additional late fees, agent fees and baseless court fees if it was not paid in full.“I would pay my rent, and if I was late, I would pay a 5% late fee, but the fees kept adding up,” Smith said in a statement paired with the lawsuit. “I work full-time and made regular payments, but they kept taking me to court for eviction and piling on the fees.” The other named plaintiff is Howard Smith (no relation), a retiree who has lived in the Kushner-owned Carroll Park Apartments in Middle River, east of Baltimore, for 10 years. He has been hit with a string of late fees and court fees and eviction notices even though he has arranged to have his rent automatically debited from his bank account every month. He has also suffered repeating flooding in his ground-floor unit, including in 2015 after a mentally unstable tenant above him left the tub running, causing Smith’s ceiling to collapse. That tenant subsequently shot two employees in the rental office.The class-action suit alleges that on several occasions in the past two years, after Smith paid his rent in full, Carroll Park misallocated a portion of that payment to non-rent charges, deemed his rent to be late, then charged him a “legal-summons fee,” even though no court had awarded such a fee at the time, as well as a “legal-agent fee,” and then filed an eviction notice to spur payment of the full bill. Smith complied, fearful of eviction.“Adding small but improper fees to the rent of tenants living paycheck to paycheck, then misallocating rent payments to those fees in order to generate more fees, is a scheme that preys on working-class tenants,” said Andrew D. Freeman of Brown, Goldstein & Levy. “Westminster Management’s misuse of Maryland courts’ eviction proceedings to force tenants to pay these improper fees makes this scheme all the more deplorable. It must be stopped.”One former tenant pursued by Kushner Companies has already received legal relief. Kamiia Warren, a home health care worker, moved her family out of the Cove Village complex in Essex, just east of Baltimore, in 2010 after her elderly neighbor started behaving erratically toward them. Warren got the necessary written approval from the on-site manager to leave in advance of her lease’s expiration. But three years later, after Kushner Companies bought the complex and took over management of it, she received notice that a Kushner subsidiary, JK2 Westminster, was suing her for $3,014.08 for having broken her lease.Warren was initially unable to locate the document showing she had permission to leave, and a Baltimore County judge awarded JK2 Westminster a judgment of nearly $5,000 against her, including court and late fees. The Baltimore-area law firm that handles all of the cases against the Kushner Companies’ local tenants then got a court order to garnish Warren’s wages and bank account — she changed jobs soon afterward, but her bank account was cleaned out.Around the same time, she got her hands on a copy of the document showing she had received permission to move and presented it in court, but the Kushner attorneys kept up their pursuit, eventually securing a court lien against her for the remaining $4,615 she allegedly owed. That lien has marred her credit record, making it hard for her to secure loans, including the one she would need to launch the small assisted living center she dreams of opening.But after the ProPublica/New York Times article appeared, featuring her treatment by Kushner Companies, lawyers at the Baltimore office of Ballard Spahr, a nationwide law firm, stepped forward offering to take on Warren’s case pro bono. They contacted the Kushner Companies’ local lawyer, Jeffrey Tapper, and earlier this month, the company agreed to a stipulation releasing Warren from the $4,615 lien — more than seven years after she moved out of Cove Village.
How the Bankruptcy System Is Failing Black Americans
by Paul Kiel with Hannah Fresques Novasha Miller pushed through</span> the revolving doors of the black glass tower on Jefferson Avenue last December and felt a rush of déjà vu. The building, conspicuous in Memphis’ modest skyline along the Mississippi River, looms over its neighbors. Then she remembered: Years ago, as a teenager, she’d accompanied her mother inside.Now she was 32, herself the mother of a teenager , and she was entering the same door, taking the same elevator. Like her mother before her, Miller was filing for bankruptcy.She’d cried when she made the decision, but with three boys and one uneven paycheck, every month was a narrow escape. A debt collector had recently won a court judgment against her and, along with that, the ability to seize a chunk of her pay. Soon, she would be forced to decide between groceries or electricity.Bankruptcy, she figured, despite its stink of shame and failure, would stop all that. She could begin anew: older, wiser, and with a job at a catering company that paid $10.50 an hour, a good bump from her last one. She could keep dreaming of a life where she had money left over at the end of each month, a chance of one day owning a home.What Miller didn’t know when she swallowed her pride and called a local bankruptcy attorney is that she would probably end up right back where she started, with the same debts, in the same crisis. For the black debtors who, for generations, have made Memphis the bankruptcy capital of the U.S., the system delivers neither forgiveness nor renewal.Up on the sixth floor of that tower where I met Miller last February, the U.S. Bankruptcy Court for the Western District of Tennessee appeared to be a well-functioning machine. Debtors, nearly all black like her, crowded the wedge-shaped waiting area as lawyers, paralegals and court staff, almost all white, milled about in front. Hundreds of cases are filed here every week, and those who oversee and administer the process all proudly note the court’s marvelous efficiency. Millions of dollars flow smoothly to creditors, to the court, to bankruptcy attorneys.But the machine hides a harsh reality. When [ProPublica analyzed consumer bankruptcy filings nationwide](https://projects.propublica.org/graphics/bankruptcy-data-analysis), the district stood out, both for the stunning number of cases in which debtors were unable to get relief, and for the reasons why. In Memphis, an entrenched legal culture has made bankruptcy a boon for attorneys while miring clients like Miller in a cycle of futility.Under federal bankruptcy law, people overwhelmed by debt have a choice: They can either file under Chapter 7, which wipes out debts and, since most filers lack significant assets, allows them to keep what little they have. Or they can choose Chapter 13, which usually requires five years of payments to creditors before any debts are eliminated, but blocks foreclosures and car repossessions as long as debtors can keep up. In most of the country, Chapter 7 is the overwhelming choice. Only in the South, [in a band of states stretching from North Carolina to Texas](https://projects.propublica.org/graphics/bankruptcy-chapter-13), is Chapter 13 predominant.The responsibility of knowing which path to pick falls to those seeking relief. In Memphis, about three-quarters of filings are under Chapter 13. That’s how Miller filed. She thought the two chapters were “the same,” she told me.Initially, they are. Upon filing, debtors are shielded from garnishments and debt collectors. But whereas under Chapter 7 those protections are generally made permanent after a few months, under Chapter 13 they last only as long as payments are made. Most Chapter 13 filers in Memphis don’t last a year, let alone five.As efficiently as cases are opened, they are closed — usually because debtors fail to keep up with payments, according to a ProPublica analysis of court data. In 2015, over 9,000 cases in the district were dismissed — more cases than were *filed* in 22 other states that year. Less than a third of Chapter 13 cases in the district result in a discharge of debts. And when their cases are dismissed, debtors are often in worse straits, because as they struggled to make payments, the interest on their unpaid debts continued to mount. Once the refuge of bankruptcy is gone, the debt floods back larger than ever. They’ve borne the costs of bankruptcy — attorney and filing fees, a seven-year flag on their credit reports — without receiving its primary benefit. A system that is supposed to eliminate debt instead serves to magnify it.Driving this tremendous churn of filings is a handful of bankruptcy attorneys with what sounds like an easy pitch: immediate relief, for free. In Memphis, it typically costs around $1,000 to hire an attorney to file a Chapter 7, but most attorneys will file a Chapter 13 for no money down. Ultimately, the fees for Chapter 13 filings are higher — upwards of $3,000 — but the payments are stretched over time. For many people, this is the only option they can afford: debt relief on credit. For attorneys, they gain clients — and a regular flow of fees — they might not otherwise get, even if few of their clients get lasting relief.For black filers in Memphis, relief is particularly rare. They are more likely than their white peers to file under Chapter 13 and less likely to complete a Chapter 13 plan. Because failure is so frequent in Memphis, many people file again and again. In 2015, about half of the black debtors who filed under Chapter 13 in the district had done so at least once before in the previous five years. Some had filed as many as 20 times over their lifetimes. Here, bankruptcy is often not the one-time rescue it was envisioned to be, but rather a way for the poor to hold on to basic necessities like electricity for a couple months.“The way we have it set up, our culture, has a lot of unintended consequences,” said Judge Jennie Latta, one of five bankruptcy judges in the Western District of Tennessee. Since 1997, when she took the bench, the racial disparities in Memphis have been evident, she said. “It was troubling to me then, and it’s still troubling to me.”When I asked judges, trustees, who administer the cases, and debtor attorneys what could be done to reduce racial disparities and improve outcomes, I was mostly met with resignation. I heard a lot about the poverty in Memphis and a legal culture with deeply rooted traditions. But ProPublica’s analysis identified bankruptcy attorneys in Memphis who had much more success in getting their black clients out of debt. These attorneys had a different approach, preferring Chapter 7 to Chapter 13, and, crucially, allowing more flexibility in what clients paid upfront in fees.Scrutiny of Memphis is important, because the racial differences we found there [are present across the country](https://projects.propublica.org/graphics/bankruptcy-data-analysis#National). Nationally, the odds of black debtors choosing Chapter 13 instead of Chapter 7 were more than twice as high as for white debtors with a similar financial profile. And once they chose Chapter 13, we found, the odds of their cases ending in dismissal — with no relief from their debts — were about 50 percent higher.Meanwhile, the $0-down style of bankruptcy practiced in Memphis, long common across the South, is quietly growing in popularity elsewhere. Chicago in particular has seen an explosion of Chapter 13 filings in recent years. A recent study found that [the “no money down” model is becoming more prevalent](https://papers.ssrn.com/sol3/papers.cfm?abstract_id=2925899), prompting concerns that it is snaring increasing numbers of unsuspecting debtors and ultimately keeping them in debt.***About 10 miles south of the black glass tower lies the community of Whitehaven. Famous as the site of Graceland, Elvis Presley’s mansion, its streets are lined with miles of humbler homes, mostly one- or two-bedroom bungalows. The houses reflect the range of financial security among Whitehaven’s almost exclusively black residents: Some lawns are immaculately kept in front of neat, pretty facades, while others run riot with weeds next to broken-down cars.This is where Novasha Miller was born and raised. She went to Hillcrest High on Graceland Drive and still lives in the area. Here, bankruptcy has a startling ubiquity. Count the bankruptcies filed from 2011 through 2015 by residents of Whitehaven, and there is almost one for every three households.Miller’s spiral downward began in late 2014, when she and her sons moved into a $545-per-month apartment in Highland Meadows, a complex pitched on its website as nestled in a “serene woodland setting.” Inside, roads wander around shaded clusters of two-story structures, some with boarded-up doors and windows.Miller soon realized she’d made a mistake by signing the lease. Roaches emerged every time she cooked, she said. Underneath the kitchen sink, mold was spreading that seemed to aggravate her 10-year-old son’s asthma. The stove broke; then bedbugs arrived, leaving telltale marks up and down her and her boys’ arms.Despite her calls and complaints, she said, management didn’t fix the mold issue and told her she’d have to pay for an exterminator herself. Finally, she decided to move. She wrote a letter saying she was breaking her lease and explaining why.“My kids’ health is more important than anything, and I just had to leave,” she told me. (The company that manages Highland Meadows did not respond to requests for comment.)A couple of months after she moved, Absolute Recovery Services, a collection agency, sent her a letter saying she owed $5,531 — a total that seemed inflated to Miller. If she didn’t pay up immediately, the agency wrote, it might sue. It followed through the next month, tacking on a $1,844 attorney fee, for a total bill of $7,375.Derek Whitlock, the attorney who represented Absolute Recovery Services in its suit against Miller, provided ProPublica with an accounting of Miller’s debt. Only $1,635 was due to back rent; the rest stemmed from eight different types of fees — all of which, Whitlock said, Miller had “contractually agreed to.” Miller’s lease had also stated that residents were “responsible for keeping the premises free from infestation of pest, etc.,” he said.With no attorney to represent her, Miller went to court. Delayed by a search for parking, she missed her case, and Absolute Recovery won a judgment against her. A court employee told her the agency could soon move to garnish her paycheck, she said.Under Tennessee law, debt collectors can seize up to a quarter of debtors’ take-home pay, and in Shelby County, which contains Memphis, they sought to do so in over 21,000 cases in 2015, according to a ProPublica analysis of court records. Such garnishments are [far more common in black neighborhoods](https://www.propublica.org/article/debt-collection-lawsuits-squeeze-black-neighborhoods).“I cried, stressing at work,” said Miller. “I couldn’t work, trying to figure out what to do.”At the time, Miller earned $9 an hour working for a catering company where her hours were often cut without warning. Although she’d never had an extended stretch of unemployment, the last several years had been a struggle. She still carried $19,000 in student loans from a cosmetology program, and a $1,100 loan from a car title lender, TitleMax, which she’d used to cover one month’s shortfall. TitleMax routinely lends at annual interest rates above 150 percent in Tennessee, and every month Miller had to come up with about $100 in interest to keep the company from seizing her 2003 Pontiac Grand Prix. If Absolute Recovery garnished her wages, Miller stood to lose her apartment, her electricity or the car she drove to work.The pressure, she said, pushed her into bankruptcy court. “It’s hard out here,” she said. “I hate that I had to go through it just to keep people from garnishing my check.”She Googled “bankruptcy attorney” and landed on the website of Arthur Ray, who has been practicing in Memphis since the 1970s. His website was topped with "$0" in large type. “Most of our Chapter 13 bankruptcies are filed for $0 attorney’s fee up front.” She called and made an appointment.***Earlier this year, I headed to Memphis to meet people like Miller and find out why attorneys there kept funneling their black clients into Chapter 13 plans when so few could complete them. I came armed with [what amounted to a score sheet for each attorney, showing how their black and white clients had fared](https://projects.propublica.org/graphics/bankruptcy-data-analysis#Differences-Among-The-Largest-Firms). ProPublica had taken every case filed in the district over 15 years, paired it with census information and put it on a map. In a starkly segregated city like Memphis, we could deduce the race of their clients with confidence based on where they lived.I caught up with Ray by phone. Like most of the higher volume lawyers in the district, Ray is white while most of his clients are black. About nine out of every 10 of his cases is a Chapter 13. And he was twice as likely to file under Chapter 7 for a white client as he was for a black client.None of this troubles Ray in the least. If Chapter 13 has an evangelist, it’s Ray, who trumpets its attributes unapologetically. In his eyes, debtors need Chapter 13 to train them to get their financial houses in order and instill discipline on their unruly spending.“A Chapter 13 shows people how to live without buying things for that 60-month plan,” he said. “With a Chapter 7, wham bam it’s over, and they’re back to the same old thing, the bad habits that got them in trouble to begin with.”When debtors squander Chapter 7’s power to erase debt, he argued, they are stuck — barred from filing again for eight years. Better to keep that option in reserve for something truly catastrophic, he said.Ray conceded that most of his clients do not successfully complete their Chapter 13 plans, but he argued that wasn’t so bad. “It may be a long time before the creditors come after them,” he said. And when the phone calls and the legal notices do come back, “then they can file again.”I told Ray that Novasha Miller hadn’t understood the difference between the two chapters. Ray was not troubled by this either. As required by law, he said, he provides clients with documents explaining the difference, but any client who asks about Chapter 7 will get an argument from him. “They need to learn how to live not buying things on credit,” he said.Few attorneys are likely to express this paternalistic view as bluntly as Ray, but the idea that bankruptcy courts should rehabilitate debtors instead of simply freeing them of their debts dates back to the 1930s, when, buoyed by creditors’ lobbying efforts, Chapter 13 first became law. It’s a form of bankruptcy that sprang from the South: Started as an experiment by the bankruptcy court in Birmingham, Alabama, it was added to the federal bankruptcy code through a bill authored by a Memphis congressman. To this day, many see Chapter 13 as the more honorable form of bankruptcy because it includes some attempt to repay debts.But when I asked some of Ray’s colleagues why so many of their clients filed under Chapter 13, honor was rarely mentioned. Instead, they said it was about holding on.“Chapter 13 is generally a ‘keep your stuff’ chapter,” is how Bert Benham, a Memphis bankruptcy attorney, put it.Most people who end up filing in the district don’t own much. In 2015, 69 percent of those who filed under Chapter 13 didn’t own a home, and the median, or typical, income was less than $23,000 per year.For many people, the most important thing is keeping their car, a necessity in Memphis, which has little public transportation. Used car lots abound, offering subprime credit. When borrowers fall behind and lenders threaten repossession, Chapter 7 won’t stop that from happening. But Chapter 13 allows secured debts to be repaid over the course of the plan. In theory, loan payments on a car or mortgage can be reduced to an affordable level, providing time to catch up without fear of repossession or foreclosure.Lured by this promise, desperate Chapter 13 filers can spend years caught in a loop. One Whitehaven resident told me how, in order to hold on to her car, she’d filed under Chapter 13 four times since 2011. The first time, she lost her job a year and a half after filing, and her case was dismissed after she fell behind. She immediately filed again to keep the car for job interviews, using unemployment benefits to make the payments until she couldn’t. She then filed a third time. Finally in 2014, after her third dismissal, she got a new part-time job paying $11 an hour and filed again.She still has two years of payments to go and will have spent most of her 30’s trying to hold on to her car. “If I’d known,” she said, “I just would have let my car go.”Bernise Fulwiley, 60, filed for Chapter 13 in 2014 to avoid foreclosure on her home, a brick bungalow with a large maple in the yard on a corner in Whitehaven. The following year, she lost her warehouse job when she required foot surgery and couldn’t keep up her payments. She got another warehouse job, earning $9.50 an hour, and filed again. She has kept up the payments for two years, and is determined to make it for three more.“‘God, go before me. Open this door! Help me, Lord!’ That’s been my prayer,” she said. “I ain’t gonna never give up.”For decades, the most prolific bankruptcy firm in Memphis has been Jimmy McElroy’s, known for its long-running TV commercials featuring the now-deceased Ruby Wilson, a legendary blues and gospel singer dubbed the Queen of Beale Street. At the end of 30-second spots, she exclaimed, “Miss Ruby sings the blues, and you don’t have to!”McElroy, a mild-mannered white man in his 70s with a genteel lilt to his speech, told me that “the ultimate success” for a Chapter 13 filing is “to pay it out, get a discharge, get out of debt. And then learn to live within your means.” From 2011 through 2015, McElroy’s firm filed over 8,000 Chapter 13 cases and fewer than 900 Chapter 7 cases. About 80 percent of his clients come from predominantly black neighborhoods.But “ultimate success” is rare at his firm. Only about one in five of the Chapter 13 cases [filed by his black clients](https://projects.propublica.org/graphics/bankruptcy-data-analysis#Differences-Among-The-Largest-Firms) reached discharge, a rate typical for the district. When I asked why, McElroy, whose office is in the same tower as the bankruptcy court, said clients generally “get the temporary relief they needed,” but then things just happen: “They lose their job. They get sick. They get a divorce.”Sometimes Chapter 7 does seem like a better choice, he said, but the client can’t afford to pay the attorney fee, which, at his firm, is about $1,000. In those cases, he’ll advise them to start with a Chapter 13, since it’s “more affordable to get into,” he said. “I tell them … ‘If you get in a better situation, we can convert later.’”Debtors are, indeed, allowed to switch from Chapter 13 to Chapter 7 after their cases have begun, although it typically requires paying an additional attorney fee. But this rarely happens in the district. Only about 5 percent of Chapter 13 filings since 2008 converted to Chapter 7, according to our analysis. For McElroy’s firm’s cases, it was 2 percent.***Often in Memphis, the whole goal of bankruptcy is just to address basic needs, even if only for a month or two.Last year, Memphis Light, Gas and Water cut off customers’ electricity for nonpayment 98,000 times. It’s an “astoundingly high” number given that Memphis provides electricity to fewer than 400,000 customers and “far higher than any other large urban utility that I’ve seen,” said John Howat, senior energy analyst with the National Consumer Law Center.Nearly half the Chapter 13 cases filed by black residents in the district had utility debt, our analysis of 2010 filings found. The typical debt with the utility company was $1,100. For customers with poor credit, the utility has a policy of disconnecting service within a couple months if the arrears grow beyond $200.MLGW does offer programs for low-income customers and installment plans for those who fall behind. “We have probably some of the most liberal customer assistance programs of any utility in the country,” said Gale Carson, spokeswoman for MLGW.But that assistance is limited to just a few thousand households. And the installment plans require customers to make the payments in addition to their normal monthly bills.By declaring bankruptcy, debtors can start a monthly Chapter 13 plan tied to their income and get the power turned back on within a month or so.In February, I visited Michael Baloga, an attorney at Long, Umsted, Jones & Kriger, at the firm’s downtown storefront, just down the street from the Shelby County Jail and next door to a bail bond agent.“Chapter 13 bankruptcy can be a necessary evil at times,” he told me. “Like, for today, there are people who are coming in because it’s cold, and they don’t have electricity.”Baloga said he didn’t like to file cases just for that reason. “But on the other hand, am I going to let them sit and freeze in their home because they don’t have it? … I know that they’re going to file the bankruptcy and that they’re not going to stay in it very long. In the alternative, am I just going to turn them away and say, ‘No, you’re not going to get a chance at all?’”For the firm’s predominantly poor and black clientele, [the chances are remarkably low](https://projects.propublica.org/graphics/bankruptcy-data-analysis#Differences-Among-The-Largest-Firms): Only one in 10 of the cases result in a discharge. Most don’t last six months.Using bankruptcy this way “seems like using a sledgehammer to hang a picture,” said Judge Latta. But she understands why debtors do it. “I think bankruptcy, in Memphis anyway, is very much part of the social safety net,” she said, “and all these problems fall down into it.”About 18,000 times each year, Tennessee suspends the driver’s license of a Shelby County resident for failing to pay a traffic fine, according to state data obtained by Just City, a Memphis nonprofit advocacy organization. About 84 percent are black drivers, although only half of Shelby County’s residents are black.In 2010, about a quarter of black residents filing Chapter 13 had outstanding debt with the Shelby County General Sessions Criminal Court, which handles mostly misdemeanors and traffic offenses, our data shows. Their typical debt was around $1,600.Court officials said licenses are only suspended if defendants fail to pay fines within 12 months. The court offers installment plans, including one called the Driver’s Assistance Program that allows drivers to regain their licenses. But only about 230 people were enrolled in the program as of March, they said.For those who can’t afford or don’t qualify for the court’s programs, Chapter 13 provides an answer. They can get their licenses reactivated within a matter of months and stretch payments over five years, if they make it that long. Such fines can’t be eliminated through Chapter 7.In Chicago, similar pressures have led to a recent boom in Chapter 13 filings. Chapter 13 filings by black residents in the Northern District of Illinois rose 88 percent from 2011 to 2015, we found. There, the issue is mostly parking tickets, according to ProPublica’s analysis and [a recent academic study](https://papers.ssrn.com/sol3/papers.cfm?abstract_id=2845497) of filings in Cook County. But, like Memphis, it’s overwhelmingly black debtors who file for Chapter 13 to forestall license suspensions or car seizures.Black households are particularly vulnerable to financial difficulties like these. They have [less income](http://www.pewsocialtrends.org/2016/06/27/1-demographic-trends-and-economic-well-being/), [fewer assets](http://www.pewresearch.org/fact-tank/2014/12/12/racial-wealth-gaps-great-recession/), and [less financial stability](http://www.pewtrusts.org/en/research-and-analysis/issue-briefs/2017/03/how-income-volatility-interacts-with-american-families-financial-security) than white ones — all [deficits](http://www.insightcced.org/wp-content/uploads/2015/08/Umbrellas_Dont_Make_It_Rain_Final.pdf) with [deep roots](https://www.theatlantic.com/magazine/archive/2014/06/the-case-for-reparations/361631/). When they are [hit with financial emergencies](http://www.pewtrusts.org/~/media/assets/2015/10/emergency-savings-report-1_artfinal.pdf?la=en) (a cut in pay, a needed car repair), they are [less likely to have the resources to withstand them](http://www.pewtrusts.org/en/about/news-room/press-releases/2015/11/18/pew-finds-american-families-ill-equipped-for-financial-emergencies). The same vulnerabilities that make black Americans more likely to file for bankruptcy make them less likely to succeed in bankruptcy.In Memphis, that means the debtors who use the bankruptcy system the most — low-income black debtors — fare the worst.“I say all the time that in Memphis, debtors don’t earn a living wage,” said Sylvia Brown, one of the two trustees for Chapter 13 cases in Memphis.***A few floors above the bankruptcy court are the offices of Cohen & Fila, a firm with a mostly poor clientele and [one of the highest volume practices in the district](https://projects.propublica.org/graphics/bankruptcy-data-analysis#Differences-Among-The-Largest-Firms). I asked Tom Fila, a Yankee transplant who has practiced bankruptcy law in Memphis for more than 20 years, about one of his clients: The firm had filed 17 cases on her behalf, all but two under Chapter 13. She was one of at least 465 people who had filed for bankruptcy 10 or more times in the district between 2001 and 2015, ProPublica’s analysis found. These repeat filers tend to be among the poorest.Fila bristled at the implication that his firm had filed the cases for any reason but the best interest of the client. “I’m not making money on these cases, and I probably shouldn’t file them,” he told me. “I often tell my clients that repeated filings aren’t doing them any good. They are ending up in the same spot they started in, only now they have multiple bankruptcy cases on their credit report … but at the end of the day I’m not the one living without utilities or being evicted or being without transportation.”Of course, most of the time attorneys in the district do get paid something. When we analyzed the Chapter 13 cases filed in 2010, we found that, on average, attorneys in the district collected $1,340 per case out of their full $3,000 fee. Some firms, like Fila’s, collected much less (about $700), and some collected more.But what has made bankruptcy a viable business for the biggest firms in Memphis for so long is the sheer volume. From the 12,000-plus Chapter 13 cases they filed in 2010, we estimate that attorneys reaped at least $16 million in attorney fees over the next five years. McElroy’s firm, the largest, collected at least $2 million.Things have worked this way in the district for as long as anyone can remember. The district’s chief judge, David Kennedy, who has presided over cases since 1980, said attorneys have been charging $0 down to file Chapter 13s at least since the 1970s.He sees no clear need for reform. Chapter 13 “provides, I think, better relief, depending on the circumstances,” he said, adding that the large number of dismissals is not necessarily bad. “Just because it doesn’t go to discharge doesn’t mean it’s a failed case.” A homeowner might file Chapter 13 to stop a foreclosure, he said, then use the breathing room to work out a loan modification with the mortgage servicer and drop the case voluntarily.That undoubtedly does happen. But most debtors in the district don’t own a home.Judge Latta said efforts to help the poor file under Chapter 7 for free have met with resistance. “We get a lot of pushback on pro bono programs here,” she said. “\[Attorneys\] say, ‘But, judge, we can put them in a Chapter 13, and we can get paid for that.’”It’s no secret in Memphis that bankruptcy works differently outside the South, but the scope of that contrast is staggering. In 2015, for example, there were 9,000 Chapter 13 cases filed in Shelby County, while in Brooklyn, New York, there were fewer than 300. Brooklyn has a similar poverty rate, median income and higher housing costs. Like Shelby County, it has a large black population. It also has 1.6 million more people.What’s the biggest difference? How bankruptcy attorneys are paid. In Brooklyn, attorneys usually ask for around $2,000 upfront to file a Chapter 13, said Michael Macco, a trustee in the Eastern District of New York. As a result, poorer households simply can’t afford to file. The typical Chapter 13 debtor who hired an attorney in Brooklyn in 2015 was a middle-income homeowner with $420,000 in assets — over 40 times more in assets than filers in Shelby County.The reasons for vast differences like these among courts are largely arbitrary. While bankruptcy is a federal institution, ruled by laws made in Washington, D.C., each local court is essentially its own kingdom with its own customs shaped by the judges, trustees and attorneys who work there. Scrutiny of these differences, and how they affect debtors, has been scant.While judges like Kennedy are untroubled by the flood of unsuccessful Chapter 13s, our analysis found Memphis attorneys who have built successful bankruptcy practices in a different way. In an office park on the eastern edge of the city, I met Jerome Payne, who has filed more Chapter 7s on behalf of black clients than anyone in the district in recent years, despite not being in the top 10 firms in terms of total volume.That alone would make Payne stand out. But Payne is also, unlike all but a few debtor attorneys in Memphis, black.A cop turned nurse turned attorney, Payne, 66, has been practicing bankruptcy law in Memphis since the 1990s. Inside his office, the thick carpeting and friendly banter between Payne and his two long-standing employees give the place a homey feel, albeit a home with files stacked everywhere and large binders labeled “GARNISHMENTS” spilling out of a cabinet.African-American identity is a major part of his practice. When his firm sends out letters to prospective clients — usually people who have been sued over a debt – he tries to make sure they know. “I use black heritage stamps,” he said. Sometimes he uses Kwanzaa stamps. He includes a page with inspirational sayings, like one with a quote from Marcus Garvey, a leader of the Black Nationalist movement, who is depicted with his body in the shape of Africa.The emphasis on blackness is not just a marketing gimmick, he said. Because the clients are “people who look like me,” he said, “they feel more comfortable with me.”And that, he said, may help in convincing debtors that Chapter 7 is a better choice. Payne’s challenge, he said, is getting them “to take the emotions out of a home, the apartment, out of the vehicle” and decide that they are better off without the debt.This discussion is what he calls his “come-to-Jesus meeting.” Contrary to Arthur Ray’s emphasis on teaching his clients financial discipline through five years of payments, Payne promotes the discipline of letting go of possessions they can’t afford.“Me being African American, and me understanding my community, maybe I’ve been more successful in showing them that this is not the way you ought to go,” he said.Crucially, Payne also approaches fees differently. Whether it’s a Chapter 7 or Chapter 13, the down payment is usually a couple hundred dollars, and his clients can pay the remainder in installments.He doesn’t file Chapter 13 cases for no money down, because he just doesn’t like the idea. And he has an employee, instead of him, discuss fee arrangements with clients, he said, because “I found that it colors the way that I do business.”Brad George is another attorney in the district who often files Chapter 7 cases for his clients. His approach is simple. “It’s not rocket science, I can tell you that,” said George, who is white and has practiced bankruptcy in Memphis for 20 years. If there is a good reason to do a Chapter 13, like a threatened foreclosure or driver’s license issue, then he will file that way. Otherwise, he said, “I think you should try and always, always, always do a \[Chapter 7\].”To file a Chapter 7 with George, it costs the debtor $555, with most of that due upfront. That is about half of what many other attorneys charge in Memphis. But, to George, it just seems like enough.“I figure I spend about two hours on average per Chapter 7 \[case\],” he said. “So that’s pretty fair, I’d say.”George also doesn’t file Chapter 13 cases for no money down, instead asking for around $200 dollars, giving his clients a much more balanced choice between how much money they have to come up with to file Chapter 7 versus Chapter 13.George’s black clients file under Chapter 7 almost half the time, according to our analysis, a rate that is almost two and a half times what is typical in the district. There is also little racial disparity in what portion of his black and white clients end up in Chapter 7.Payne and George agree that their flexibility with fees is likely a key reason they are able to file more Chapter 7 cases for black clients.There are understandable reasons why attorneys tend to be less flexible with Chapter 7 fees. When debtors receive a discharge of their debts at the end of the case, outstanding fees to their attorneys are also wiped out. Any further payments are voluntary. As a result, debtor attorneys — in Memphis or anywhere else — generally require the entirety of their fee upfront. To address this problem, some scholars [have called for Congress to change the law](https://papers.ssrn.com/sol3/papers.cfm?abstract_id=2925899) to make attorney fees clearly exempt from discharge.Such a change could have a large effect. The firm that files the most bankruptcy cases in Atlanta, for example, files Chapter 7 cases for $0 down, with the entirety of the fee due through an installment plan that lasts several months. The chief judge in the Northern District of Georgia has ruled that such arrangements are legal, and other large firms in the Atlanta area have adopted the practice.The result is clear. In the heart of the South, most of the filings in the Northern District of Georgia are under Chapter 7 — compared to less than 30 percent in the rest of the state. And notably, black debtors in that district file under Chapter 7 almost half the time, a rate significantly higher than even the white debtors in the Western District of Tennessee.***For now, things in Memphis continue as they seemingly always have. In April, less than six months after it began, Novasha Miller’s Chapter 13 case was dismissed. Though she hasn’t heard anything yet, her old landlord’s collection agency is again free to attempt garnishment of her wages.Miller said that a miscommunication with her attorney led to the dismissal. After she changed jobs again (the new one pays a little bit less, $9.36 an hour, but it’s full-time and she likes the people), she notified Ray’s office, she said, but the plan payments were never set up to be automatically withdrawn from her paychecks. However it happened, having paid about $600, all of which was absorbed by court and attorney fees, she was back to square one. Choosing Chapter 7 could have resulted in her emerging from bankruptcy with her student loan as her only remaining debt. Instead, her debts, having gone unpaid for months, were now larger — she’s not clear yet just how much — the interest applied as if the bankruptcy had never happened.She is thinking of filing again, maybe with a different attorney. And hopefully, she said, this time it’ll work out.
Data Analysis: Bankruptcy and Race in America
by Paul Kiel and Hannah Fresques
Have You Seriously Considered Filing for Bankruptcy?
by ProPublica Have you seriously considered filing for bankruptcy any time in the last ten years?ProPublica is working on a series of stories about the bankruptcy system. If you hit financial difficulties at any time in the last ten years and really thought about filing for bankruptcy, we want to hear from you. And we especially want to hear from you if you did not file — maybe because you couldn’t afford an attorney or you decided bankruptcy wouldn’t help. Whatever the reason, we’d like to hear it.You can either text “hello” to 317-707-6371, or fill out the form below. You’ll inform our reporting on whether the bankruptcy system is providing help to those who need it.We’ll keep you updated on what we find. If you have any other questions about the series or our work, we’re also checking our inbox at bankruptcy@propublica.org. This form requires JavaScript to complete.Powered by Screendoor.
Bankruptcy: What’s the Difference Between Chapter 7 and Chapter 13?
by Paul Kiel The two main bankruptcy options available to people overrun by consumer debt are Chapter 7 or Chapter 13. The options differ greatly in how they work and the relief they provide. Below are the basic attributes of each chapter, as well as statistics drawn from ProPublica’s analysis of bankruptcy filings from 2008-2015 to show what types of debtors are choosing each chapter and how successful they are at having their debts wiped away or discharged. This guide is part of our series on bankruptcy, which takes a close, critical look at the system and its shortcomings. Have You Seriously Considered Filing for Bankruptcy? If you’ve really thought about filing for bankruptcy, ProPublica wants to hear from you — even if you ultimately decided against it. Chapter 7 is a form of liquidation, meaning the debtor’s assets are divvied up among creditors. However, 95 percent of cases involve debtors who do not have assets above the legal threshold, which is set by state law, and therefore don’t have to give up anything. The median Chapter 7 case lasts three and a half months from filing to discharge. About 96 percent of debtors who file under Chapter 7 receive a discharge of their debts.When a debt is discharged, it is no longer legally owed. Unsecured debts (e.g. credit cards, medical bills, etc.) are typically dischargeable with some important exceptions like student loans. Secured debts (e.g. a mortgage, a car loan) are dealt with differently in a Chapter 7: Typically a debtor can either relinquish the secured asset or keep it by continuing payments.Chapter 13 is a form of repayment plan. The debtor’s obligations are combined in one, regular payment (although certain ongoing obligations like utility bills might be paid outside the plan) calibrated to the debtor’s income. A Chapter 13 plan often involves paying a portion of unsecured debts.A Chapter 13 plan can last from three to five years, but most plans are five-year plans. In cases filed between 2008 and 2010, about 41 percent of debtors who filed under Chapter 13 received a discharge of their debts. Another 10 percent first filed under Chapter 13, but then converted to Chapter 7 and received a discharge that way.Why would someone choose one or the other?Speaking generally, the primary benefit offered by Chapter 7 is near-guaranteed debt relief. Chapter 13 primarily offers benefits related to secured debt. For example, Chapter 13 stops foreclosure proceedings so debtors who have fallen behind on their mortgages can catch up over time without the danger of losing their homes.Also, if someone has filed for bankruptcy in recent years and successfully discharged their debts, they might be forced to choose Chapter 13, since Chapter 7 has stricter rules about refiling. After receiving a Chapter 7 discharge, for example, debtors are barred for eight years from receiving another one, but they would only have to wait four years to file under Chapter 13. There is no such time limit if the debtor’s earlier case was dismissed.What is the effect of filing on someone’s credit score?Bankruptcy is a negative credit event, but the effect isn’t the same for everyone.Initially, Chapter 7 and Chapter 13 have the same effect on a credit score, which diminishes over time. The main difference is that the flag for a Chapter 13 bankruptcy is removed from the debtor’s credit history seven years after filing, while a Chapter 7 bankruptcy stays on there for 10 years.Because people who file for bankruptcy usually have fallen behind on a number of debts, the typical bankruptcy filer has a credit score in the range of 525 to 575, which is lower than about 80 percent of the population with a score. It is a score that is so low that when someone files for bankruptcy, their credit score tends to actually jump up in the following year. This is because the negative mark of a bankruptcy is outweighed by the positive effect of the debt relief.How much does an attorney cost?A comprehensive study of attorney fees put the average price of a Chapter 7 in 2009 at around $1,000 and a Chapter 13 at around $2,600. Those averages would probably be at least 25 percent higher if measured today, though, and fees vary from court district to court district. For example, in Memphis the typical Chapter 13 attorney fee is now $3,800.Chapter 7 attorney fees are generally due in full before filing, although there are places (again, it depends on where you live) where attorneys will offer an installment plan. In a Chapter 13, part of the fee is typically paid up front, with the remainder paid through the plan. In certain areas of the country, particularly in the South, attorneys will start a Chapter 13 case for very little — frequently $0 — paid up front. This can be a problem when debtors choose Chapter 13 simply because they can’t afford Chapter 7. Low-income debtors (with household annual income below about $35,000) are at particular risk of failing to complete Chapter 13 plans and having their cases dismissed.What happens if someone’s case is dismissed without a discharge?Almost all Chapter 7 cases end in a discharge, so this is mostly a concern for Chapter 13 filers.Debtors with lower incomes are less likely to reach discharge through Chapter 13. Furthermore, black debtors are more likely than white debtors to choose Chapter 13, but they are less likely to reach discharge, as we show in this story.When Chapter 13 cases are dismissed, the protection of bankruptcy is removed. Because the payments that debtors made during the plan were typically less than what they contractually owed, they will likely find themselves further behind on their debts.How does having an attorney affect someone’s chances?Debtors who are represented by attorneys tend to fare far better than those who aren’t.Only about 8 percent of debtors who filed under Chapter 7 from 2008-2015 did so without an attorney’s help. About 72 percent of those cases ended in the debt being discharged. By comparison, debtors who were represented by attorneys received discharges 98 percent of the time.About 9 percent of debtors who filed under Chapter 13 from 2008-2015 did so without an attorney’s help. It is very rare for such cases to reach discharge. Only about 4 percent of the Chapter 13 pro se cases filed from 2008-2010 ended in discharges.How many people choose each chapter? What is the typical financial profile of filers?Nationally, about 71 percent of consumer filings were through Chapter 7 during the years following the Great Recession (2009-2011), but Chapter 7 filings fell off in more recent years (2013-2015), when they accounted for 66 percent of filings. The median Chapter 7 debtor from 2008-2015 had annual income of about $35,000.In the South, Chapter 13 is far more popular, partly due to lower up-front attorney fees. In nine states (Alabama, Arkansas, Georgia, Louisiana, Mississippi, North Carolina, South Carolina, Tennessee, and Texas), at least half of consumer filings are under Chapter 13. Click here to see a map that shows what percentage of filings are under Chapter 13 in each county nationwide.This big regional difference reflects a difference in what sort of debtors use Chapter 13. Outside the South, Chapter 13 is overwhelmingly used by middle-income homeowners, while in the South, a lot more low-income debtors (with income similar to Chapter 7 debtors) file under Chapter 13, and many don’t even own a home.What happens to people in financial trouble who don’t file for bankruptcy?There are plenty of reasons, some good, some bad, not to file for bankruptcy. But we’d like your help answering this question. Have you considered filing for bankruptcy any time in the past 10 years? Do you know someone else who did — or is right now? Fill out our survey and tell us about your experience. We’d like to hear from as many people as possible in the coming months to inform our reporting on how the system is working — or not. Please share.
In the South, Bankruptcy Is Different, Especially for Black Debtors
by Hannah Fresques and Paul Kiel
Senator Calls on Insurers to Improve Access to Non-Opioid Pain Treatments
by Charles Ornstein A U.S. senator whose state has been devastated by the opioid epidemic sent letters Tuesday asking two major health insurance companies to remove barriers to non-opioid pain treatments.The letters from Sen. Joe Manchin, D-W.Va., follow a story by ProPublica and The New York Times, which detailed how insurers have restricted access to pain medications that carry a lower risk of addiction or dependence, even as they provided comparatively easy access to cheaper, generic opioid medications.“The practices detailed in the article are the exact opposite of what we need and will only serve to worsen the opioid epidemic, putting more people at risk of opioid addiction and overdose death,” Manchin wrote in letters to David S. Wichmann, chief executive of UnitedHealth Group, and Joseph R. Swedish, chief executive of Anthem Inc.“Specifically, I ask you to reduce or eliminate the barriers that your beneficiaries face to access non-opioid pain medications and physical therapy for pain management. Just as importantly, I urge you to ensure that every beneficiary that you serve that needs substance use disorder treatment, including behavioral health counseling, is able to affordably access it.” UnitedHealth was cited in the story because it stopped covering Butrans, a painkilling skin patch that contains buprenorphine, an opioid that has a lower risk of abuse and dependence than generic, long-acting opioids. As a result, a patient said she turned to long-acting morphine to control her pain, went to the emergency room because she could not control her pain, and now visits her doctor more often than before.Anthem denied a request for Lyrica, a non-opioid, brand-name drug, for a patient who had been using it successfully to treat the pain associated with interstitial cystitis, a chronic bladder condition. She cannot afford the roughly $520 monthly retail price of Lyrica, she said, so she takes generic gabapentin, a related, cheaper drug. She said it does not manage the pain as well as Lyrica.UnitedHealth and Anthem defended their decisions and said they take the opioid crisis seriously. Both companies said they have been able to successfully decrease the number of opioid prescriptions taken by members.In a statement Tuesday, Anthem said, “We share the Senator’s concerns about overdoses in West Virginia and the entire country, and agree that more needs to be done to address the opioid epidemic. That’s why Anthem is addressing the opioid epidemic through a holistic approach involving prevention, treatment and recovery and deterrence.”Anthem said a West Virginia affiliate, Unicare Health Plan of West Virginia, is expanding a program to offer substance use treatments as part of primary care, removing the stigma that may be attached to it. The insurer also said it covers non-opioid pain relief drugs “according to best clinical practice guidelines and scientific evidence,” noting that some carry retail prices of $350 to $1,500 per prescription.UnitedHealth has not yet responded to a request for comment.Until recently, the role of insurers in fanning — or at least failing to stop — the opioid crisis has not received as much attention as that of other players, including pharmaceutical companies, doctors and drug distributors.A day after the ProPublica/New York Times story was published, attorneys general for 37 states sent a letter to the health insurance industry’s main trade group, urging its members to reconsider coverage policies that may be fueling the opioid crisis. “The status quo, in which there may be financial incentives to prescribe opioids for pain which they are ill-suited to treat, is unacceptable,” the letter said. “We ask that you quickly initiate additional efforts so that you can play an important role in stopping further deaths.”Insurers say they have been addressing the issue on many fronts, including monitoring patients’ opioid prescriptions, as well as doctors’ prescribing patterns. Moreover, at least two large pharmacy benefit managers, which run insurers’ drug plans, announced this year that they would limit coverage of new prescriptions for pain pills to a seven- or 10-day supply.Manchin’s daughter, Heather Bresch, is the chief executive of Mylan, a major pharmaceutical company. Mylan last month disclosed that it had received a subpoena from the Department of Justice seeking information about its manufacturing and sales of opioids. The company said it was cooperating.While opioids such as hydrocodone and morphine are often prescribed to relieve pain, they also have been linked to abuse and dependence. Drug overdoses are now the leading cause of death among Americans under 50, and more than 2 million Americans are estimated to misuse opioids.For our story earlier this month, ProPublica and the Times analyzed Medicare prescription drug plans covering 35.7 million people in the second quarter of this year. Only one-third of the people covered, for example, had any access to Butrans. And every drug plan that covered lidocaine patches, which are not addictive but cost more than other generic pain drugs, required that patients get prior approval from the insurer for them.Moreover, we found that many plans make it easier to get opioids than medications to treat addiction, such as Suboxone. Drug plans covering 33.6 million people include Suboxone, but two-thirds require prior authorization. And even if they do approve coverage, some insurance companies have set a high out-of-pocket cost for Suboxone, rendering it unaffordable for many addicts, a number of pharmacists and doctors said.In his letters, Manchin asked UnitedHealth and Anthem to share their plans for addressing the crisis. “We have lost too many Americans to the opioid epidemic,” he wrote. “I hope that your company will be a part of the solution.”
Senator: Someone Needs to Be Fired Over Wasted $65 Million Plane
by Megan Rose When it comes to Afghanistan, the Pentagon seems to have a penchant for buying planes that don’t fly.The military “wasted” nearly $65 million on a single inoperable plane that spent years resting on jacks in a warehouse and didn’t manage even one flight in Afghanistan, the Department of Defense inspector general recently reported. The plane, tricked out with sophisticated surveillance capabilities, was supposed to fly counternarcotics missions to disrupt Afghanistan’s vast heroin operations, but languished on its perch in Delaware.“Consequently, the DoD received no benefit for its more than seven years’ work and $64.8 million in funds wasted,” the inspector general wrote.The debacle unfortunately has a depressingly familiar ring. In 2014, after spending $486 million on 20 planes for the Afghan Air Force — which, yes, were never able to fly — the Pentagon sold most of them as scrap metal for a whopping 6 cents a pound. The total sale was $32,000. Sixteen cargo planes were sold as scrap metal. (Courtsey of SIGAR) The $65 million counternarcotics plane was part of the “Global Discovery Program” run jointly with the Drug Enforcement Administration, and is merely the latest in a long string of failed or questionable U.S. programs in Afghanistan. (And it’s yet another example of the failed overall $8.4 billion counternarcotics effort in Afghanistan that has led to more heroin, not less. In 2016, Afghanistan grew nearly three times as much poppy than it had in 2002, according to the United Nations.) A ProPublica investigation found that as of 2015 there were at least $17 billion worth of such projects. To see what kind of projects that money could have paid for here in the U.S. — for example, the testing of the nation’s entire backlog of rape kits or ending dependency on Russia in space — check out this game:
How Military Outsourcing Turned Toxic
by Abrahm Lustgarten <!-- START CMS BODY CONTENT --> <script src="https://connect.facebook.net/en_US/all.js"></script> <div id="fb-root"></div> <script> FB.init({ appId : '229862657130557', // App ID status : true, // check login status cookie : true, // enable cookies to allow the server to access the session xfbml : true // parse XFBML }); </script><!-- we can't edit body tag, so use custom bodyclass value in YAML if needed --><div id="page-body" class="default default-alt story-contractors"><pp-special><header role="banner"> <h1><a href="https://features.propublica.org">ProPublica</a></h1> <h2><a href="https://www.propublica.org/series/bombs-in-our-backyard">Bombs in Our Backyard</a></h2><nav><ul class="social-links"><li class="facebook social-widget ss-fb" data-title="How U.S. military outsourcing turned toxic" data-img="" data-txt="Fraud. Bribery. Incompetence. The military’s use of contractors adds to a legacy of environmental damage." data-desc="Fraud. Bribery. Incompetence. 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Bribery. Incompetence. The military’s use of contractors adds to a legacy of environmental damage.</h2> </div> <div class="credits"><p class="byline">by Abrahm Lustgarten, ProPublica</p><p class="byline">Photography by Ashley Gilbertson/VII Photo, special to ProPublica</p> <p class="dateline"> <time>September 26, 2017</time> </p> </div></header><!-- end article header --><div class="wrapper"><div class="content"><p class="opening"><span class="lead-in"><span class="dropcap">I</span>n August 2016,</span> an inspector from the U.S. Environmental Protection Agency arrived at Barksdale Air Force base in Louisiana, a nerve center for the U.S. military’s global air combat operations, to conduct a routine look at the base’s handling of its hazardous waste.</p><p>Barksdale, like many military bases, generates large volumes of hazardous materials, including thousands of pounds of toxic powder left over from cleaning, painting and maintaining airplanes.</p><aside class="promotion series-promotion"> <div class="group"> <span data-picture="" data-alt=""> <span data-src="https://features.propublica.org/military-pollution/assets/images/generated/bomb-art-TEST-2-360*159-621f1b.jpg"></span> <span data-src="https://features.propublica.org/military-pollution/assets/images/generated/bomb-art-TEST-2-720*318-621f1b.jpg" data-media="(-webkit-min-device-pixel-ratio: 1.3), (min-resolution: 124.8dpi)"></span> <noscript> <img src="https://features.propublica.org/military-pollution/assets/images/generated/bomb-art-TEST-2-360*159-621f1b.jpg" alt="" /> </noscript> </span> <h3>Bombs in Our Backyard</h3> <p>This story is part of an ongoing series examining the Pentagon’s oversight of thousands of toxic sites on American soil, and years of stewardship marked by defiance and delay.</p> </div> <div class="group"> <h3>Email Updates</h3> <p>Sign up to get ProPublica’s major investigations delivered to your inbox.</p> <!-- Begin MailChimp Signup Form --><div id="mc_embed_signup"><form action="//propublica.us6.list-manage.com/subscribe/post?u=ff2018a8e2&amp;id=f74e196955" method="post" id="mc-embedded-subscribe-form" name="mc-embedded-subscribe-form" class="validate" target="_blank" novalidate=""><div id="mc_embed_signup_scroll"><div class="mc-field-group"><label for="mce-EMAIL">Sign up to get ProPublica’s investigations delivered to your inbox.</label><input placeholder="you@example.com" type="email" value="" name="EMAIL" class="required email" id="mce-EMAIL" /></div><!-- UPDATE THIS FOR EACH INVESTIGATION --><!--<div class="mc-field-group hidden"><input checked type="checkbox" value="16" name="group[15237][16]" id="mce-group[15237]-15237-4"><label for="mce-group[15237]-15237-4">Advoserve</label></div>--><!-- real people should not fill this in and expect good things - do not remove this or risk form bot signups--> <div style="position: absolute; left: -5000px;" aria-hidden="true"><input type="text" name="b_ff2018a8e2_f74e196955" tabindex="-1" value="" /></div><input type="submit" value="Subscribe" name="subscribe" id="mc-embedded-subscribe" class="button" /><div id="mce-responses"><div class="response" id="mce-error-response" style="display:none"></div><div class="response" id="mce-success-response" style="display:none"></div></div> </div></form></div><script src="//s3.amazonaws.com/downloads.mailchimp.com/js/mc-validate.js"></script><script>(function($) {window.fnames = new Array(); window.ftypes = new Array();fnames[0]='EMAIL';ftypes[0]='email';fnames[3]='TWITTER';ftypes[3]='text';}(jQuery));var $mcj = jQuery.noConflict(true);</script><!--End mc_embed_signup--> </div></aside><p>For years, Barksdale had been sending a portion of its waste to an Ohio company, U.S. Technology Corp., that had sold officials at the base on a seemingly ingenious solution for disposing of it: The company would take the contaminated powder from refurbished war planes and repurpose it into cinderblocks that would be used to build everything from schools to hotels to big-box department stores — even a pregnancy support center in Ohio. The deal would ostensibly shield the Air Force from the liabililty of being a large producer of dangerous hazardous trash.</p><p>The arrangement was not unique.</p><p>The military is one of the country’s largest polluters, with an inventory of toxic sites on American soil that once topped 39,000. At many locations, the Pentagon has relied on contractors like U.S. Technology to assist in cleaning and restoring land, removing waste, clearing unexploded bombs, and decontaminating buildings, streams and soil. In addition to its work for Barksdale, U.S. Technology had won some 830 contracts with other military facilities — Army, Air Force, Navy and logistics bases — totaling more than $49 million, many of them to dispose of similar powders.</p><p>In taking on environmental cleanup jobs, contractors often bring needed expertise to technical tasks the Pentagon isn’t equipped to do itself. They also absorb much of the legal responsibility for disposing of military-made hazards, in some cases helping the Pentagon — at least on paper — winnow down its list of toxic liabilities.</p><p>But in outsourcing this work, the military has often struggled to provide adequate oversight to ensure that work is done competently — or is completed at all. Today, records show, some of the most dangerous cleanup work that has been entrusted to contractors remains unfinished, or worse, has been falsely pronounced complete, leaving people who live near former military sites to assume these areas are now safe.</p><p>What the EPA inspector found when he visited Barksdale was an object lesson in the system’s blind spots.</p><p>Barrels of the waste hadn’t been shipped off and recycled, but rather were stored in a garage tucked away from the facility’s main operations. Further, shipping documents suggested that what waste had been sent off the base hadn’t gone to U.S. Technology’s recycling plant in Ohio, as an Air Force official first told the EPA, but instead had gone to company warehouses in at least two other states. Storing hazardous waste without a permit — and without immediately recycling it — can be illegal.</p><p>The inspection findings triggered an investigation to determine if the Air Force had been storing hazardous waste that it was supposed to have been recycling without a permit. It also suggested broader problems with U.S. Technology, which was already the subject of an inquiry in Georgia into whether it was illegally dumping waste — including material that could have come from Barksdale — near a residential neighborhood there.</p><p>Barksdale officials told ProPublica that the base “has never stored” hazardous materials at the request of U.S. Technology. The Air Force and the Pentagon declined to answer any specific questions about U.S. Technology’s work, except to say that the base had been working with the company for at least a decade.</p><figure class="default"> <span data-picture="" data-alt=""> <span data-src="https://features.propublica.org/military-pollution/assets/images/generated/20170824_ProPublica_Barksdale_1243-480*720-132c23.jpg"></span> <span data-src="https://features.propublica.org/military-pollution/assets/images/generated/20170824_ProPublica_Barksdale_1243-960*1440-132c23.jpg" data-media="(-webkit-min-device-pixel-ratio: 1.3), (min-resolution: 124.8dpi)"></span> <span data-src="https://features.propublica.org/military-pollution/assets/images/generated/20170824_ProPublica_Barksdale_1243-900*1350-132c23.jpg" data-media="(min-width: 37.5em)"></span> <span data-src="https://features.propublica.org/military-pollution/assets/images/generated/20170824_ProPublica_Barksdale_1243-1800*2700-132c23.jpg" data-media="(min-width: 37.5em) and (-webkit-min-device-pixel-ratio: 1.3), (min-width: 37.5em) and (min-resolution: 124.8dpi)"></span> <noscript> <img src="https://features.propublica.org/military-pollution/assets/images/generated/20170824_ProPublica_Barksdale_1243-480*720-132c23.jpg" alt="" /> </noscript> </span> <figcaption>U.S. Air Force Tech Sergeant Jonathan Hayes works on a B-52 bomber from the 307th Bomb Wing at Barksdale Air Force Base. For more than a decade the Air Force has relied on a private company to handle its waste, even though that company has been associated with multiple investigations and fraud.</figcaption></figure><p>ProPublica pieced together what happened at Barksdale using EPA records, including a 1,000-page document compiled by one of its lead investigators, as well as Air Force correspondence, court files, Pentagon contracts and other materials.</p><p>The documents make clear that officials at Barksdale should have been wary of doing business with U.S. Technology from the start. The head of one of its sub-contractors had been sent to prison in 2008 for illegally dumping hazardous waste under another Pentagon contract. U.S. Technology had been investigated for related wrongdoing — storing or dumping material it claimed to be recycling — in two other states. Indeed, a 2011 Pentagon report to Congress about contractor fraud included U.S. Technology on a list of companies that had criminal or civil judgments against them, but which still received millions of dollars in subsequent contracts.</p><p>Neither the Air Force nor the Pentagon would respond to questions about why the various military branches continued to award contracts to U.S. Technology despite its problems.</p><p>The EPA also would not say whether it was looking into U.S. Technology’s contracts with other bases — deals involving millions of pounds of toxic powder and tens of millions of taxpayer dollars — but such a step might well be prudent.</p><p>In April, U.S. Technology’s founder and president, Raymond Williams, was indicted in U.S. District Court in Missouri for trucking millions of pounds of its hazardous powder waste — from Defense and other types of contracts — over state lines, where, according to EPA documents, the company had been storing it instead of recycling it. In June, Williams was indicted in Georgia on federal charges related to bribing an Air Force official for recycling contracts. Williams has pleaded not guilty in both cases.</p><p> Asked about Barksdale and other contracts that have gone awry, one of the Pentagon’s top environmental officials told ProPublica that there is no systemic problem with the military’s approach to cleanup or other environmental contracting. Maureen Sullivan, the deputy assistant secretary of defense for environment, safety and occupational health, said the military might have thousands of companies under contract at any given time and that the Barksdale case and others like it amount to rare examples of negligence or incompetence.</p><p>“Not everybody is an angel,” Sullivan said.</p><p>Still, the Pentagon and its various monitors have issued repeated warnings about problems related to environmental cleanup contractors.</p><p>In 2001, the Defense Department’s own inspector general discussed the “significant risk of fraud” in environmental cleanup contracts as one of the Pentagon’s “high risk vulnerabilities.” That report did not list recommendations for reform, chiefly because many of the office’s previous efforts imploring changes had been ignored.</p><p>A decade later, the U.S. Government Accountability Office concluded that many Pentagon environmental cleanup contracts were vulnerable to corner-cutting, lack of quality review and plain incompetence. The report made clear that the department relied heavily on performance-based contracts despite federal guidelines which cautioned against using them for environmental jobs, perhaps because doing so furthered the Pentagon’s self-interest in ridding itself of environmental headaches.</p><p>“The evidence is in, a contractor is only as good as the oversight that they have,” said Jane Williams, the executive director of California Communities Against Toxics, a watchdog group that has been tracking defense site cleanups across the country since 1989. “The defense department turns a blind eye… They want to write a check and have someone else do it.”</p><hr /><figure class="full"> <span data-picture="" data-alt=""> <span data-src="https://features.propublica.org/military-pollution/assets/images/generated/20170824_ProPublica_Barksdale_1709-480*320-1d082b.jpg"></span> <span data-src="https://features.propublica.org/military-pollution/assets/images/generated/20170824_ProPublica_Barksdale_1709-960*640-1d082b.jpg" data-media="(-webkit-min-device-pixel-ratio: 1.3), (min-resolution: 124.8dpi)"></span> <span data-src="https://features.propublica.org/military-pollution/assets/images/generated/20170824_ProPublica_Barksdale_1709-900*600-1d082b.jpg" data-media="(min-width: 37.5em)"></span> <span data-src="https://features.propublica.org/military-pollution/assets/images/generated/20170824_ProPublica_Barksdale_1709-1800*1200-1d082b.jpg" data-media="(min-width: 37.5em) and (-webkit-min-device-pixel-ratio: 1.3), (min-width: 37.5em) and (min-resolution: 124.8dpi)"></span> <noscript> <img src="https://features.propublica.org/military-pollution/assets/images/generated/20170824_ProPublica_Barksdale_1709-480*320-1d082b.jpg" alt="" /> </noscript> </span> <figcaption>Barksdale Air Force Base is home to nearly half of the U.S.’s remaining B-52 fleet, airplanes that are more than 55 years old, and require constant maintenance.</figcaption></figure><hr /><p> </p><p><span class="lead-in">Airmen call Barksdale Air Force</span> base “The Deuce” — home to the 2nd Bombing Wing of the 8th Air Force, a legendary unit in American aerial bombardment with roots going back to World War I. The Wing was moved to Barksdale in 1963, with the production of the B-52. In 1991, seven B-52s flew the longest round-trip combat mission in aviation history from Barksdale’s hangers, firing the first cruise missiles of the first Gulf War into Baghdad from their holds beneath the bombers’ gaping wings.</p><p>Today, nearly half of the Air Force’s remaining B-52’s fly from this heavily guarded, 22,000-acre base, which has 8,500 airmen stationed there. Those 185,000-pound hunks of aging, flexing metal — still the workhorse of the nation’s strike force more than 55 years after the last one was made — need an extraordinary amount of work to keep them in the air. At Barksdale, the airplanes’ parts are sanded and painted, corrosion removed, cracks in the fuselage cut out and patched, rivets drilled hollow and replaced. All so the planes can return to flight training over Eastern Europe or bombing raids against ISIS in Syria.</p><p>Essential to this unglamorous, but vital work are millions of tiny glass and plastic beads that machinists use to blast against metal parts to strip away paint and corrosion. The process leaves huge amounts of toxic dust, including the flaked paint and bits of pulverized metal from the planes themselves.</p><p>U.S. Technology was founded in 1987 by Williams, described by colleagues as an eccentric entrepreneur with a love for historic fighter planes and airplane design. U.S. Technology and its dozen or so affiliated corporations have tried to sell everything from inexpensive prop fighter planes to the United Arab Emirates to concrete blocks. But the core business has always been the bead blasting and recycling.</p><p>For years Barksdale handled the waste produced by its airplane maintenance just as it handled any other hazardous material: It catalogued and labeled it, registered the quantities with the EPA and state authorities, and shipped it to a specialized disposal facility in Kentucky that was licensed to burn or bury the stuff.</p><p>But in the last decade, the Pentagon began to press Barksdale and other bases to comply with “waste minimization” rules set out in federal regulations. Barksdale officials said they were required to cut the volume of waste the base produced by 10 percent from 2010 levels by 2020, for example. Increasingly, all bases — which compete for funding and whose officers vie for promotions — are judged on meeting or beating quotas for limiting and then promptly handling waste.</p><p>Documents make clear U.S. Technology’s pitch spoke directly to Barksdale and was calibrated to help achieve these aims. The company promised to supply all of the base’s blast powder and then retrieve the spent material — thousands of pounds of it a year — to use as fill to make cinderblocks. The EPA and Ohio environment officials had certified this was relatively safe, so long as the cinderblocks didn’t come into contact with the ground, where they could potentially contaminate food and water supplies.</p><figure class="inset"> <span data-picture="" data-alt=""> <span data-src="https://features.propublica.org/military-pollution/assets/images/generated/20170824_ProPublica_Barksdale_0840-square-480*480-246d8f.jpg"></span> <span data-src="https://features.propublica.org/military-pollution/assets/images/generated/20170824_ProPublica_Barksdale_0840-square-960*960-246d8f.jpg" data-media="(-webkit-min-device-pixel-ratio: 1.3), (min-resolution: 124.8dpi)"></span> <span data-src="https://features.propublica.org/military-pollution/assets/images/generated/20170824_ProPublica_Barksdale_0840-square-900*900-246d8f.jpg" data-media="(min-width: 37.5em)"></span> <span data-src="https://features.propublica.org/military-pollution/assets/images/generated/20170824_ProPublica_Barksdale_0840-square-1800*1800-246d8f.jpg" data-media="(min-width: 37.5em) and (-webkit-min-device-pixel-ratio: 1.3), (min-width: 37.5em) and (min-resolution: 124.8dpi)"></span> <noscript> <img src="https://features.propublica.org/military-pollution/assets/images/generated/20170824_ProPublica_Barksdale_0840-square-480*480-246d8f.jpg" alt="" /> </noscript> </span> <figcaption>The U.S. Environmental Protection Agency is investigating whether officials at Barksdale Air Force Base stored hazardous waste from the maintenance of its aircraft against federal regulations, and whether the company it hired to recycle it was instead dumping it.</figcaption></figure><p>The deal also promised other benefits.</p><p>Because U.S. Technology was a recycler, the toxic material it removed from Barksdale would no longer be classified legally as “hazardous waste.” This semantic end run spared the Air Force from having to meet strict federal regulations for where such waste goes and for protecting people from being harmed by it. As one company sales document put it, recyclable materials “are exempt from regulation as a waste.” It also meant that, at least technically, Barksdale’s ledger would show that it was producing less waste overall, and thus edging closer to the Pentagon’s goals.</p><p>U.S. Technology’s sales documents boasted that its approach offered its military customers “maximum protection” from liability and costs related to cleanups, and could maybe even prevent contaminated areas from becoming Superfund sites.</p><p>Still, the presentations left out important bits of the company’s history.</p><p>In order to be exempt from hazardous waste laws, federal regulations require waste recycling companies like U.S. Technology to re-purpose at least three-quarters of the hazardous material they collect as part of contracts in any given year. The rule is meant to ensure that waste isn’t simply being stored. Storing hazardous waste requires a highly specialized license and, done wrong, can lead to environmental disaster.</p><p>In 2002, however, Ohio and EPA investigators inspected U.S. Technology’s plant and found discrepancies in its inventories of hazardous materials received from the military and other customers. Of some 3.6 million pounds of material U.S. Technology had accepted in 2000, for example, only 98,000 pounds of it had been used for recycled products, a figure “well short of the required amount,” according to Ohio state records. In an alleyway next to the building, investigators found stacks of unused outdoor patio furniture apparently molded from hazardous powder but never sold.</p><p>“There obviously wasn’t a market for the furniture,” wrote Nyall McKenna, the Ohio environment regulator who led the investigation.</p><p>The investigators found that U.S. Technology had directly recycled a small portion of the material, but shipped the vast majority of it to a processing company in Mississippi that U.S. Technology had hired to reformulate the material into large blocks that the U.S. Army Corps of Engineers — a Pentagon branch itself — could use in its management of the country’s river systems. But it turned out the processing company, Hydromex, hadn’t been recycling the material either. Instead, it had been burying U.S. Technology’s waste in trenches it dug underground, and then had used the remaining powder to make a concrete slab that covered the holes. By the time the EPA and state regulators learned this, more than 11 million pounds of waste from Ohio, and U.S. Technology customers around the country — packed into 25,000 drums — had been stashed at the site in Yazoo, Mississippi.</p><p>Hydromex’s owner was sent to prison for more than three years. U.S. Technology and its officials avoided prosecution, saying the company was not aware of Hydromex’s dumping and was itself a victim of fraud. (In a later civil trial, a jury rejected U.S. Technology’s fraud claims against the property owner of the Hydromex plant.) In the eyes of regulators, though, U.S. Technology remained liable for the waste material under environmental law, and would ultimately be tasked with removing and — again — properly recycling the dumped waste.</p><figure class="medium"> <span data-picture="" data-alt=""> <span data-src="https://features.propublica.org/military-pollution/assets/images/generated/20170824_ProPublica_Barksdale_0965-480*320-898aa0.jpg"></span> <span data-src="https://features.propublica.org/military-pollution/assets/images/generated/20170824_ProPublica_Barksdale_0965-960*640-898aa0.jpg" data-media="(-webkit-min-device-pixel-ratio: 1.3), (min-resolution: 124.8dpi)"></span> <span data-src="https://features.propublica.org/military-pollution/assets/images/generated/20170824_ProPublica_Barksdale_0965-900*600-898aa0.jpg" data-media="(min-width: 37.5em)"></span> <span data-src="https://features.propublica.org/military-pollution/assets/images/generated/20170824_ProPublica_Barksdale_0965-1800*1200-898aa0.jpg" data-media="(min-width: 37.5em) and (-webkit-min-device-pixel-ratio: 1.3), (min-width: 37.5em) and (min-resolution: 124.8dpi)"></span> <noscript> <img src="https://features.propublica.org/military-pollution/assets/images/generated/20170824_ProPublica_Barksdale_0965-480*320-898aa0.jpg" alt="" /> </noscript> </span> <figcaption>Military installations, including Barksdale, often produce large amounts of hazardous waste. Pentagon officials have set targets for bases to reduce the amount of waste they handle, a program which may be incentivizing the outsourcing of disposal to contractors with little follow-up.</figcaption></figure><p>EPA documents and emails obtained by the agency show some of the material dumped in Mississippi came from U.S. military bases and that the case had gotten the attention of the Air Force in particular. At least two other bases — Robins Air Force Base in Georgia and Hill Air Force base in Utah — had been working with U.S. Technology, and others were about to start until they were informally warned off by headquarters, pending a review, according to Air Force documents.</p><p>In the end, though, any Air Force wariness concerning U.S. Technology proved short-lived. Senior brass, as part of their look at what had gone wrong in 2002, visited the company’s operations in 2005 and came away with a favorable view.</p><p>“U.S. Technology has a very impressive recycling operation,” William Hoogsteden, a project manager at the Air Force research laboratory at Wright-Patterson Air Force Base in Ohio, wrote in a 2005 memo. The company, the official concluded, “looks to be one of the few legitimate and viable recycling processes using spent plastic media.” </p><p>Another 2005 letter pushed U.S. Technology’s appeal explicitly. “Their products help us achieve diversion targets (recycle vs. disposal),” wrote David Fort, an Air Force hazardous waste program manager, in an internal Air Force exchange. “This is something that we simply ought to take advantage of.”</p><p>In 2006, various Pentagon branches signed 30 contracts with U.S. Technology worth more than $2.7 million. </p><hr /><p> </p><p><span class="lead-in"><span class="dropcap">T</span>he volume and complexity</span> of environmental cleanup work has led the Pentagon to rely more and more on contractors like U.S. Technology. According to the GAO, such companies now handle nearly all of the hazardous waste the Defense Department generates annually, and, according to Pentagon data obtained by ProPublica, at least 2,400 contaminated cleanup sites across the country have been outsourced to private firms.</p><p>Cleaning up contamination at these sites has already consumed more than $42 billion in taxpayer funds, much of it paid to contractors. By the Pentagon’s conservative estimates, the total cleanup bill is likely to top $70 billion, making Defense pollution one of the most expensive environmental calamities in American history, and a lucrative mainstay for private concerns.</p><p>Virtually all Pentagon contracting — for weapons, aircraft, base security, reconstruction in war zones, and more — has come under criticism for cost overruns and, at times, for being open to exploitation. It’s impossible to say how environmental cleanup contractors compare to others in these regards. But experts say environmental work is especially hard to monitor; waste disposal and contamination are easy to hide and hard to track. Also, with Pentagon officials under pressure to reduce the list of contaminated sites and cut the costs of attending to them, there’s less incentive to question contractors that say problems are fixed or jobs are done well.</p><p>A lengthy trail of damning reports from military watchdogs, however, suggests the same problems have cropped up time and again when the Pentagon has delegated environmental cleanups to contractors.</p><p>In 2015, calling environmental issues a “longstanding material weakness,” the Pentagon’s inspector general said that despite publishing some 20 previous reports on the issue, little progress had been made in adopting recommendations.</p><p>One of those previous reports was the 2001 report to Congress, which noted that environmental crimes committed by hazardous waste contractors warranted the majority of attention from the agency’s criminal investigations division. Contractors cut corners, falsely certified as done environmental work they hadn’t completed, illegally dumped dangerous materials, or employed workers who weren’t properly trained for their tasks, the report said, describing such incidents as “typical” and “discussed regularly.”</p><figure class="medium"> <span data-picture="" data-alt=""> <span data-src="https://features.propublica.org/military-pollution/assets/images/generated/20170505_ProPublica_Cali_0377-480*320-96987c.jpg"></span> <span data-src="https://features.propublica.org/military-pollution/assets/images/generated/20170505_ProPublica_Cali_0377-960*640-96987c.jpg" data-media="(-webkit-min-device-pixel-ratio: 1.3), (min-resolution: 124.8dpi)"></span> <span data-src="https://features.propublica.org/military-pollution/assets/images/generated/20170505_ProPublica_Cali_0377-900*600-96987c.jpg" data-media="(min-width: 37.5em)"></span> <span data-src="https://features.propublica.org/military-pollution/assets/images/generated/20170505_ProPublica_Cali_0377-1800*1200-96987c.jpg" data-media="(min-width: 37.5em) and (-webkit-min-device-pixel-ratio: 1.3), (min-width: 37.5em) and (min-resolution: 124.8dpi)"></span> <noscript> <img src="https://features.propublica.org/military-pollution/assets/images/generated/20170505_ProPublica_Cali_0377-480*320-96987c.jpg" alt="" /> </noscript> </span> <figcaption>A water truck sprays down dust at Hunters Point in San Francisco, California in May. The former Navy shipyard is one of thousands of heavily contaminated former defense sites now being being redeveloped for housing and public use.</figcaption></figure><p>The inspector general noted that across all branches of the Pentagon, environmental contracts were ripe for abuse because remediation relies so heavily on contractors to self-report their progress. And it also noted that the results of the review were “disappointing because the department made limited progress in carrying out numerous agreed-upon recommendations” from the past.</p><p>John Arlington, who researched corruption at defense sites as a former chief investigator for the House Committee on Energy and Commerce, said the problems were epic.</p><p>“We discovered a very long history of hazardous disposal practices of the worst sort,” said Arlington, who now serves as general counsel for the SIGAR, the Special Inspector General for Afghanistan Reconstruction.</p><p>In many cases, egregious malpractice — or even intentional deception — hasn’t been enough to steer the Pentagon away from particular contractors. In San Francisco, in 2016, the Nuclear Regulatory Commission determined that employees of a prominent global environmental engineering firm hired by the Navy had falsified soil samples from a radioactive experiment site soon to be converted to housing in the nation’s hottest real estate market. The contractor, Tetra Tech, has received more than $2.3 billion in defense contracts over the past decade, and was being paid more than $300 million for its cleanup in San Francisco.</p><p>In a legal petition the San Francisco environment group Greenaction submitted to NRC investigators, several Tetra Tech whistleblowers said that, in order to save money, Tetra Tech managers had ordered them to replace contaminated soil samples with clean soil, dump contaminated soil in trenches on the property, falsify documents certifying the work and manipulate the computer data analyzing radiation levels. Their allegations raised questions about environmental safety across some 420 acres of the site.</p><p>Tetra Tech, which conducted an internal investigation and conceded its samples had been swapped, “emphatically denies” that its management was involved or that there was a broader conspiracy at the site, according to a statement the company sent to ProPublica. The NRC, at first, fined Tetra Tech $7,000, but even that amount was later reduced after an agreement that the company would hold additional training for its employees. A Navy spokesperson said that while Tetra Tech is still under contract, it is no longer doing field work at the site.</p><p>At Camp Minden, a former Army ammunition plant now owned by Louisiana and used by its National Guard, a munitions waste recycling contractor’s failures caused a disaster too big to ignore.</p><p>As part of a nationwide effort to decommission more than a billion pounds of aging weapons, the Army hired a company called Explo Systems to disassemble 1.3 million artillery charges at Minden. For $8.6 million, the firm would remove the shells and casings and empty an explosive propellant powder called M6. Explo claimed to have industrial facilities to recycle the M6, and said it would safely destroy some of it while converting the rest into blasting charges it planned to sell to the mining industry.</p><p>Had the Army ever looked into Explo’s capabilities, it would have learned that it had not yet built two of the processing facilities it would need to destroy and convert the Army’s explosive material. Nevertheless, by mid-2012, Explo documents appeared to show that it had shipped and sold nearly 18 million pounds of the explosives.</p><p>That illusion quite literally blew up on Oct. 15, 2012, when a massive explosion rocked the Minden grounds, shattering windows in the town four miles away, toppling 11 rail cars, and sending a mushroom cloud 7,000 feet into the sky. EPA records describe a blast radius of raw explosives landing as close as a few thousand feet from the nearby town.</p><figure class="default"> <span data-picture="" data-alt=""> <span data-src="https://features.propublica.org/military-pollution/assets/images/generated/20170414_ProPublica_UXO_0158-480*320-189eb8.jpg"></span> <span data-src="https://features.propublica.org/military-pollution/assets/images/generated/20170414_ProPublica_UXO_0158-960*640-189eb8.jpg" data-media="(-webkit-min-device-pixel-ratio: 1.3), (min-resolution: 124.8dpi)"></span> <span data-src="https://features.propublica.org/military-pollution/assets/images/generated/20170414_ProPublica_UXO_0158-900*600-189eb8.jpg" data-media="(min-width: 37.5em)"></span> <span data-src="https://features.propublica.org/military-pollution/assets/images/generated/20170414_ProPublica_UXO_0158-1800*1200-189eb8.jpg" data-media="(min-width: 37.5em) and (-webkit-min-device-pixel-ratio: 1.3), (min-width: 37.5em) and (min-resolution: 124.8dpi)"></span> <noscript> <img src="https://features.propublica.org/military-pollution/assets/images/generated/20170414_ProPublica_UXO_0158-480*320-189eb8.jpg" alt="" /> </noscript> </span> <figcaption>An environmental engineering firm with more than $2 billion in Pentagon contracts has admitted that its employees falsified radioactive soil samples at Hunters Point. Whistleblowers from the firm allege the conduct was part of a larger conspiracy by the company to speed up work and lower costs.</figcaption></figure><p>When Louisiana State police executed a search warrant of the base, they found nearly 18 million pounds of M6 explosives stored haphazardly across the property. Photographs show enormous cardboard boxes overstuffed with explosives, sagging under their own weight with water stains rotting their base. The boxes teetered in hallways, were stacked in doorways and spilled out in the surrounding yards, where thousands of them were lined up across fields like parked cars at a county fair. Louisiana’s extreme heat and humidity had taken its toll, degrading the chemical stabilizers that bond the explosives, until they verged on spontaneous ignition.</p><p>The remaining materials could have blown at any time. Louisiana’s governor declared a state of emergency, and for a week that December, the small community of Doyline along the base’s fence line was evacuated. </p><p>“It was a perfect storm,” said J.C. King, the Army’s director of munitions and the chief official responsible for Army explosives cleanups, in an interview at the Pentagon in July.</p><p>King says what happened in Minden, though, is no longer the Army’s problem; when Explo signed its contract, it assumed ownership of the explosives and any contamination that might be associated with them, he said. EPA investigators determined Explo had falsified its sales paperwork and, in fact, had few customers; the very premise of its Army contract was a lie. Six of its executives wound up indicted. They have pleaded not guilty, and are currently awaiting trial in Louisiana. Explo Systems declared bankruptcy the next fall, abandoning the explosives. Its executives did not respond to a request for comment made through their attorney.</p><p>Despite the substantial real-world harm that has resulted from misconduct by contractors, the Pentagon continues to rely ever more heavily on them for environmental work even as the budget for that work has been whittled. Experts say the process is flawed, incentivizing shortcuts and outsourcing to save money and preserve the Pentagon’s primary military mission. But unless the Pentagon substantially tightens oversight to weed out problem contractors, experts say, the Defense Department’s enormous environmental cleanup program — an effort affecting an amount of land larger than the state of Florida — will only become more vulnerable to abuse.</p><p>“It’s about priorities; you either pay for a certain result or you end up playing hide the ball,” said William Frank, who for 25 years oversaw Pentagon cleanups at the EPA as a senior attorney in the Federal Facilities Enforcement Office. “The DoD is not accountable and it hasn’t been. But they are complicit. The process itself has this fatal flaw of the necessity of balancing the military warfighter mission and the weapons development industry versus their legal liability” under environmental law. “And it’s not working.”</p><hr /><figure class="medium"> <span data-picture="" data-alt=""> <span data-src="https://features.propublica.org/military-pollution/assets/images/generated/20170823_ProPublica_Barksdale_0330-480*320-42e199.jpg"></span> <span data-src="https://features.propublica.org/military-pollution/assets/images/generated/20170823_ProPublica_Barksdale_0330-960*640-42e199.jpg" data-media="(-webkit-min-device-pixel-ratio: 1.3), (min-resolution: 124.8dpi)"></span> <span data-src="https://features.propublica.org/military-pollution/assets/images/generated/20170823_ProPublica_Barksdale_0330-900*600-42e199.jpg" data-media="(min-width: 37.5em)"></span> <span data-src="https://features.propublica.org/military-pollution/assets/images/generated/20170823_ProPublica_Barksdale_0330-1800*1200-42e199.jpg" data-media="(min-width: 37.5em) and (-webkit-min-device-pixel-ratio: 1.3), (min-width: 37.5em) and (min-resolution: 124.8dpi)"></span> <noscript> <img src="https://features.propublica.org/military-pollution/assets/images/generated/20170823_ProPublica_Barksdale_0330-480*320-42e199.jpg" alt="" /> </noscript> </span> <figcaption>Residents of Doyline, Louisiana were evacuated in 2012 out of fears that millions of pounds of discarded explosives left on the grounds of a former nearby Army plant at Camp Minden, might explode. A contracting firm was hired by the Army to recycle old munitions, but instead stored them in cardboard boxes, leading to an earlier massive explosion.</figcaption></figure><hr /><p> </p><p><span class="lead-in"><span class="dropcap">W</span>hen the EPA’s</span> David Robertson showed up at Barksdale in August 2016, it appears he was there to do nothing more than a pro-forma inspection. It didn’t take Robertson long, however, to figure out the deal U.S. Technology offered the base was less than advertised, and maybe even a complete sham.</p><p>His inspection report shows that thousands of pounds of waste from Barksdale hadn’t been shipped to the company’s plant in Ohio, as a Barksdale official initially had said. Instead, shipping documents suggested that much of the waste had been trucked to warehouses in Arkansas and Georgia. There was no paperwork whatsoever for more than a year, from July 2014 until February 2016. And then there were the 55-gallon drums full of bead blast powder on the base itself — labeled “exempt,” and not as hazardous. Some of the grayish powder was loose, sprinkled across the tops of the drums.</p><p>Standard practice for EPA waste inspectors is to examine every link in the chain of custody before they sign off on a site. Robertson — seeking to verify the explanations offered by Barksdale staff — called regulators in Georgia and Arkansas and told them about the manifests indicating Barksdale waste had been shipped into their states. The Arkansas regulators, according to what Robertson wrote in his inspection report, told him they knew nothing about the shipments or about warehouses storing waste.</p><p>An EPA official in Georgia, however, was alarmed by the call from Robertson. He alerted Robertson to U.S. Technology’s past legal troubles in Mississippi, and said he’d already been investigating U.S. Technology’s facility in Macon for dumping hazardous waste nearly identical to what Barksdale had produced — and shipped to Macon in 2016 — on the grounds of an old track, called the Middle Georgia Raceway.</p><p>The track, which once hosted NASCAR races, hasn’t been used for more than auto shows and test driving events since the 1980s, but the community surrounding it has slowly encroached, turning the once-rural and industrial area into a tightly packed nest of suburban streets and family homes.</p><p>According to EPA documents from Georgia, one of U.S. Technology’s affiliated companies, U.S. Technology Aerospace Engineering, loaded the waste into dumpsters and trucked it to the raceway, where it was spread over several access roads and stashed in barrels lined up as an impact barrier for drivers on the oval. The EPA report does not say directly whether investigators determined the waste came from Barksdale, but it is described as bead-blast waste from the sandblasting of machinery. They found gray piles of loose, dusty material less than 90 feet from people’s backyards.</p><p>In June 2016, the EPA sent an environmental contracting firm out to the track to sample the soils. Lab reports show the company found significant levels of chromium, arsenic, lead and cadmium. Only the arsenic exceeded health limits when measured for an industrial area — which the racetrack is zoned as. But the levels of chromium, lead and cadmium would all be considered much more dangerous if judged by residential health standards. By that measure, the Middle Georgia Raceway contained arsenic at 28 times the EPA’s limit, and cadmium at nearly four times what would be considered safe. High levels of chromium were also present, but there is no federal screening standard.</p><p>Robertson makes clear in his report on Barksdale that he suspected both the Air Force and U.S. Technology of what the EPA calls “sham recycling.” The EPA would not comment on the status of its investigation, but its documents show it has assigned an agency criminal investigator and criminal counsel to the case.</p><figure class="medium"> <span data-picture="" data-alt=""> <span data-src="https://features.propublica.org/military-pollution/assets/images/generated/20170823_ProPublica_Barksdale_0727-480*320-118334.jpg"></span> <span data-src="https://features.propublica.org/military-pollution/assets/images/generated/20170823_ProPublica_Barksdale_0727-960*640-118334.jpg" data-media="(-webkit-min-device-pixel-ratio: 1.3), (min-resolution: 124.8dpi)"></span> <span data-src="https://features.propublica.org/military-pollution/assets/images/generated/20170823_ProPublica_Barksdale_0727-900*600-118334.jpg" data-media="(min-width: 37.5em)"></span> <span data-src="https://features.propublica.org/military-pollution/assets/images/generated/20170823_ProPublica_Barksdale_0727-1800*1200-118334.jpg" data-media="(min-width: 37.5em) and (-webkit-min-device-pixel-ratio: 1.3), (min-width: 37.5em) and (min-resolution: 124.8dpi)"></span> <noscript> <img src="https://features.propublica.org/military-pollution/assets/images/generated/20170823_ProPublica_Barksdale_0727-480*320-118334.jpg" alt="" /> </noscript> </span> <figcaption>For years the Pentagon has increased its reliance on third party private firms to conduct environmental cleanup and hazardous waste disposal at U.S. Defense properties, despite repeated warnings from watchdogs that such contracts are ripe for abuse. More than 2,000 sites in ProPublica’s database employ contracting firms for cleanups.</figcaption></figure><p>The Georgia dumping — which EPA is investigating separately — suggests a potentially larger problem with U.S. Technology.</p><p>The company appeared, once again, to be having difficulty turning its powder waste into viable products. According to John Socotch, the company’s long-time director of sales, the market for U.S. Technology’s powder dried up when the construction industry tanked in 2008 and it never fully recovered.</p><p>“Ray had to continually find other means, other companies to recycle the material,” Socotch said of the company’s owner in an interview with ProPublica. He said the company tried selling military waste for brick facades and to glass companies, in order “to get rid of the material.”</p><p>In Georgia, the raceway’s owner, a local real estate developer who also owns the building in Macon that served as U.S. Technology’s warehouse, told ProPublica that Williams personally appealed to him to dump the waste. “They were asking me about potential sources to get rid of the stuff, because it just accumulates in the warehouse,” said Tim Thornton. Thornton said Williams promised him the material wasn’t hazardous. </p><p>Ray Williams did not return repeated phone calls from ProPublica, and his lawyer declined to comment. According to Socotch, Williams sold the company’s patents, contracts and processes in April 2015 to an Ohio businessman named Anthony Giancola. Giancola’s office did not return repeated calls for comment, but arranged for Socotch to speak with ProPublica.</p><p>The sale of the company has not distanced Williams from criminal cases related to its military contracts. In June, he was indicted in a U.S. District Court in Georgia on charges of paying a Department of Defense official $20,000 a year to tailor contracts at Robins Air Force base so that only U.S. Technology’s bead blasting and recycling services could satisfy them. According to the 84 counts in the indictment, between 2004 and 2013 Williams allegedly conspired with the officer, Mark Cundiff, on contracts large and small, including a $25 million supply contract for U.S. bases and NATO members to purchase blasting materials. Cundiff has pleaded guilty in the case.</p><p>In a separate case, Missouri officials indicted Williams and U.S. Technology Corp. in April 2017 on charges of conspiracy to illegally dispose of hazardous waste. After the Hydromex case in Mississippi, U.S. Technology acquired Hydromex and Williams promised to properly recycle the material that had been dumped in Yazoo. Instead, in 2013, Missouri officials determined that U.S. Technology had trucked the material — 9 million pounds of it — over the state border and deposited it in a U.S. Technology warehouse in Berger, Mo. Williams has pleaded not guilty in that case.</p><p>Today, U.S. Technology Corp. has reconstituted itself under new leadership, and a slightly revised name.</p><p>In April 2015, U.S. Technology Corp. fired all of its employees, according to Socotch. The next day the new owner, who had purchased the patented products and the recycling process from Williams, hired everyone back — including Socotch, the long-time sales director. The company is now called U.S. Technology Media, and is located in one of Williams’ old recycling buildings.</p><p>“We’re trying to get people to understand we are not that guy,” Socotch said of Williams. “We are not that company.”</p><p>The Pentagon, it seems, is already persuaded.</p><p>Between April 2015 and June 2017, the Pentagon awarded 62 contracts to the new company, worth more than $1.9 million. Barksdale officials continued to deal with the new company — and shipped more of its waste to it — in 2016. In late July, after EPA officials sent federal agencies a letter warning them that U.S. Technology was under investigation, and the Pentagon banned U.S. Technology Corp. — the old company — from any new government contracts, adding them to a list of forbidden companies. Contracts with the new company are still allowed.</p><p>Back at Barksdale, records show that the Air Force has promised the EPA it will now handle its waste on its own, registering its barrels of contaminated powder in federal and state hazardous waste databases and likely shipping them to the licensed disposal facility in Kentucky. It says it will no longer work with U.S. Technology Media.</p><figure class="full"> <span data-picture="" data-alt=""> <span data-src="https://features.propublica.org/military-pollution/assets/images/generated/20170824_ProPublica_Barksdale_1052-480*320-597078.jpg"></span> <span data-src="https://features.propublica.org/military-pollution/assets/images/generated/20170824_ProPublica_Barksdale_1052-960*640-597078.jpg" data-media="(-webkit-min-device-pixel-ratio: 1.3), (min-resolution: 124.8dpi)"></span> <span data-src="https://features.propublica.org/military-pollution/assets/images/generated/20170824_ProPublica_Barksdale_1052-900*600-597078.jpg" data-media="(min-width: 37.5em)"></span> <span data-src="https://features.propublica.org/military-pollution/assets/images/generated/20170824_ProPublica_Barksdale_1052-1800*1200-597078.jpg" data-media="(min-width: 37.5em) and (-webkit-min-device-pixel-ratio: 1.3), (min-width: 37.5em) and (min-resolution: 124.8dpi)"></span> <noscript> <img src="https://features.propublica.org/military-pollution/assets/images/generated/20170824_ProPublica_Barksdale_1052-480*320-597078.jpg" alt="" /> </noscript> </span> <figcaption>B-52 Stratofortress bombers have flown historic combat missions from Barksdale Air Force base in Louisiana, including the first attack on Baghdad during the first Gulf War. More recently, Barksdale planes have bombed ISIS targets in Syria. </figcaption></figure><p>That, of course, leaves the question of what ever happened to decades worth of hazardous materials Williams and U.S. Technology removed from American military installations. Socotch says much of it was properly recycled, but he declined to say how much or to document the effort.</p><p>It appears that neither the company nor the Air Force plans to take responsibility for the unprocessed waste. Whatever hazardous waste U.S. Technology had accumulated in its warehouses, Socotch said, is still owned by U.S. Technology Corp., Williams’ apparently now-defunct company.</p><p>“I can only speak for the new company, because the new company started fresh,” Socotch said. “I don’t know what the old company continues to do to get rid of recycled material.”</p><p><em><strong>Help us Investigate:</strong> If you have experience with or information about the military’s use of contractors and environmental cleanups, email <a href="mailto:Abrahm.Lustgarten@propublica.org">Abrahm.Lustgarten@propublica.org</a>. For additional coverage, see more from ProPublica’s <a href="Abrahm.Lustgarten@propublica.org">Bombs in Our Backyard</a> series.</em></p><hr /><div class="author-bio"> <a href="https://www.propublica.org/site/author/abrahm_lustgarten"><img src="https://features.propublica.org/military-pollution/assets/images/abrahm-lustgarten-mug-200x200.jpg" alt="Author photo" /></a> <p><a href="https://www.propublica.org/site/author/abrahm_lustgarten">Abrahm Lustgarten</a> is a senior environmental reporter, with a focus at the intersection of business, climate and energy.</p></div><div class="author-bio"> <p>Nina Hedevang, Razi Syed, Alex Gonzalez, Lauren Gurley, Clare Victoria Church, Alessandra Freitas, Emma Cillekens and Eli Kurland, students in the NYU Arthur L. Carter Journalism Institute graduate studies program, have contributed reporting for the Bombs in Our Backyard project.</p></div><div class="author-bio"> <p>Design, production, and opening photo by <a href="https://www.propublica.org/site/author/david_sleight">David Sleight</a>.</p></div><hr /></div><!-- end .content --></div><!-- end .wrapper --><footer><div id="article-bottom"></div><!-- Begin MailChimp Signup Form --><div id="mc_embed_signup"><form action="//propublica.us6.list-manage.com/subscribe/post?u=ff2018a8e2&amp;id=f74e196955" method="post" id="mc-embedded-subscribe-form" name="mc-embedded-subscribe-form" class="validate" target="_blank" novalidate><div id="mc_embed_signup_scroll"><div class="mc-field-group"><label for="mce-EMAIL">Sign up to get ProPublica’s investigations delivered to your inbox.</label><input placeholder="you@example.com" type="email" value="" name="EMAIL" class="required email" id="mce-EMAIL"></div><!-- UPDATE THIS FOR EACH INVESTIGATION --><!--<div class="mc-field-group hidden"><input checked type="checkbox" value="16" name="group[15237][16]" id="mce-group[15237]-15237-4"><label for="mce-group[15237]-15237-4">Advoserve</label></div>--><!-- real people should not fill this in and expect good things - do not remove this or risk form bot signups--> <div style="position: absolute; left: -5000px;" aria-hidden="true"><input type="text" name="b_ff2018a8e2_f74e196955" tabindex="-1" value=""></div><input type="submit" value="Subscribe" name="subscribe" id="mc-embedded-subscribe" class="button"><div id="mce-responses"><div class="response" id="mce-error-response" style="display:none"></div><div class="response" id="mce-success-response" style="display:none"></div></div> </div></form></div><script src='//s3.amazonaws.com/downloads.mailchimp.com/js/mc-validate.js'></script><script>(function($) {window.fnames = new Array(); window.ftypes = new Array();fnames[0]='EMAIL';ftypes[0]='email';fnames[3]='TWITTER';ftypes[3]='text';}(jQuery));var $mcj = jQuery.noConflict(true);</script><!--End mc_embed_signup--> <section id="comments"><div id="disqus_thread"></div><script>var disqus_shortname = 'propublica';var disqus_url = 'https://features.propublica.org/military-pollution/military-pollution-contractors-scandal-toxic-cleanups/';var disqus_title = 'How Military Outsourcing Turned Toxic';var disqus_identifier = '134926';/* * * DON'T EDIT BELOW THIS LINE * * */(function() {var dsq = document.createElement('script'); dsq.type = 'text/javascript'; dsq.async = true;dsq.src = '//' + disqus_shortname + '.disqus.com/embed.js';(document.getElementsByTagName('head')[0] || document.getElementsByTagName('body')[0]).appendChild(dsq);})();</script><noscript><p>Please enable JavaScript to view the <a href="http://disqus.com/?ref_noscript">comments powered by Disqus.</a></p></noscript><p><a href="http://disqus.com" class="dsq-brlink">Comments powered by <span class="logo-disqus">Disqus</span></a></p></section><!-- end #comments --></footer></article></main><!-- end main[role="main"] --> <footer role="contentinfo"> </footer><!-- end footer[role="contentinfo"] --></div><!-- end #page-body --><!-- start footer scripts --><script src="https://features.propublica.org/military-pollution/assets/js/main.js?2017092612811"></script><!-- end footer scripts --><!-- END CMS BODY CONTENT -->
ProPublica Seeks Source Code for New York City’s Disputed DNA Software
by Lauren Kirchner ProPublica is asking a federal court for access to the source code for New York City’s proprietary DNA software, which some scientists and defense lawyers contend may be inaccurate in matching a defendant to a complex sample of genetic material. Known as a pioneer in analyzing the most difficult evidence from crime scenes, the New York City medical examiner’s office has processed DNA samples supplied not only by local police, but also by about 50 jurisdictions nationwide.Employees developed the disputed software — known as the Forensic Statistical Tool, or FST — to analyze evidence consisting of multiple people’s DNA and determine the likelihood that a suspect’s DNA was present. According to the medical examiner’s office, FST was used in about 1,350 criminal cases from 2011 until this year, when it was phased out. The office has long kept the source code secret, successfully opposing requests in court by defense attorneys to examine it.A motion ProPublica filed today in the Southern District of New York asks Judge Valerie Caproni to lift a protective order she had issued in a recent case, U.S. v. Kevin Johnson. While she became the first judge to require the lab to turn over the source code to the defense, her order barred parties in the case from sharing or discussing it.As reported earlier this month by ProPublica and The New York Times, defense expert Nathaniel Adams, a computer scientist and an engineer at a private forensics consulting firm in Ohio, reviewed the code and found that “the correctness of the behavior of the FST software should be seriously questioned.” However, the versions of Adams’ affidavits available to the public were heavily redacted and the code itself remains shielded by the judge’s order. The medical examiner’s office characterized Adams’ criticisms as stylistic rather than substantive and said FST’s calculations were reliable.FST played a key role in Johnson’s case. He was arrested after a police search found two guns in his ex-girlfriend’s apartment, where he sometimes stayed. The DNA lab in the medical examiner’s office found two people’s DNA on one gun; by FST’s calculation, it was 156 times more likely than not to contain Johnson’s DNA. The second gun had three people’s DNA and a formidable likelihood of 66 million. Johnson pleaded guilty to illegal gun possession and Caproni sentenced him last month to 28 months in prison, most of which he has already served.ProPublica filed a public-records request for the FST source code in July. The medical examiner’s office denied the request, citing its “sensitive nature” and writing that “source code consists of information that, ‘if disclosed, would jeopardize the capacity of [OCME] to guarantee the security of its information technology assets.’” The office’s special counsel denied ProPublica’s appeal in August.ProPublica is seeking to intervene in U.S. v. Johnson with the assistance of the Media Freedom and Information Access Clinic at Yale Law School, which offers pro bono services to news organizations.Richard Tofel, president of ProPublica, said, “We are seeking disclosure of this code because of the considerable public interest in the accuracy of its predictions, and to further scrutiny of its impact. If we prevail on our motion, we would envision publishing the code alongside an analysis of its likely effectiveness.” Other nonprofit organizations are also seeking to open proprietary source codes for DNA analysis to wider scrutiny. On Sept. 13, the American Civil Liberties Union and Electronic Frontier Foundation filed briefs in California’s appeals court, supporting efforts by a man convicted of sexual assault and burglary to gain access to the algorithm behind a widely used software program called TrueAllele. The DNA evidence in his case was so small and mixed that initial analysis was inconclusive, but prosecutors say TrueAllele linked him to three crime scenes in east Bakersfield. He was sentenced to life in prison without parole. The developer of TrueAllele contends that its code is a trade secret.Kevin Johnson’s attorneys, Sylvie Levine and Christopher Flood of the Federal Defenders of New York, said they also plan to submit a motion to make the FST source code public. Flood told Caproni in Johnson’s sentencing hearing last month that Adams’ critique of FST “affects every result that has ever been produced by that software,” so there is a public interest in allowing him to discuss it freely.“It’s hard to imagine a justification for a public lab to be so opaque, when science demands transparency,” Flood told ProPublica after the hearing.A coalition of defense attorneys, including Flood, sent a letter to New York state’s inspector general, Catherine Leahy Scott, on Sept. 1, asking her to investigate the DNA lab and the thousands of past criminal cases that relied on the results of either FST or a second controversial technique called “high-sensitivity testing.”Because the lab has kept problems with its “unreliable” testing and “unsound statistical evidence” secret from the public and the courts, the attorneys wrote, “innocent people may be wrongly convicted, and people guilty of serious crimes may go free.”Following the ProPublica/New York Times article, several elected officials have expressed concern about New York’s DNA testing methods. Three members of the New York City Council — Rory Lancman, Carlos Menchaca and Rafael Espinal — called for further investigation. “The findings in the report raise serious questions about the methods used by the city’s medical examiner to analyze complex DNA samples,” said Lancman, who represents a district in Queens and is the chair of the council’s Committee on Courts and Legal Services. “The possibility that these techniques resulted in numerous wrongful convictions is alarming and undermines confidence in our justice system.”Joseph Lentol, a New York State Assembly member from north Brooklyn, called for strengthening the state commission that oversees forensic methods. Lentol, who sponsored a bill more than two decades ago that paved the way for DNA testing in criminal proceedings, told ProPublica on Sept. 8 that the New York State Commission on Forensic Science — comprised of forensic lab officials, law enforcement representatives, lawyers and political appointees — should be solely made up of scientists. The DNA Subcommittee of the state commission, which approves all DNA analysis methods used in New York state, unanimously voted in 2010 to recommend the use of FST even though it did not have access to FST’s source code in its evaluation process.“DNA is very powerful, and that’s why we need to be careful,” said Lentol. Regarding the disputed FST program, he said, “It’s something that should have been more carefully analyzed, and not passed by the forensic commission in the first place without a real close look at it.”The commission discussed the ProPublica/New York Times article on Sept. 13 in executive session, meaning that reporters were not allowed to cover it and members could not talk about the proceedings publicly. The commission chair, Michael Green, said beforehand that the discussion would be held behind closed doors to avoid jeopardizing any future investigation by the inspector general. Leahy Scott is reviewing the defense attorneys’ letter, her spokesman said.The medical examiner’s office says it switched from FST to a new program, STRmix, because of changing FBI standards and not because of any deficiencies with FST. Dr. Barbara Sampson, New York City’s chief medical examiner, defended the lab’s DNA testing methods in a Medium post she wrote in response to the ProPublica/New York Times article.In addition to the Johnson case, attorneys in other ongoing criminal proceedings are citing FST’s perceived unreliability as a basis for defenses and appeals. Mayer Herskovic, a Hasidic Jew and Brooklyn father of two who was sentenced to four years in prison for gang assault after the lab said that his genetic material matched a complex sample of DNA found on the victim’s sneaker, is now appealing his conviction. His lawyer plans to argue that FST was never tested on a population as insulated as the Hasidic Jews of Williamsburg, who very likely share many of the same ancestors, and therefore much of the same DNA.“DNA is the magic word,” Herskovic told ProPublica. “If you throw it into a trial, they eat it up. For me, it’s not magic at all.”
What We Do and Don’t Know About Facebook’s New Political Ad Transparency Initiative
by Julia Angwin On Thursday, Facebook Chief Executive Mark Zuckerberg announced several steps to make political ads on the world’s largest social network more transparent. The changes follow Facebook’s acknowledgment earlier this month that $100,000 worth of political ads were placed during the 2016 election cycle by “inauthentic accounts” linked to Russia.The changes also follow ProPublica’s launch of a crowdsourcing effort earlier this month to collect political advertising from Facebook. Our goal was to ensure that political ads on Facebook, which until now have largely avoided scrutiny, receive the same level of fact-checking by journalists, advocacy groups and political opponents as do print, broadcast and radio political ads. We hope to have some results to share soon.In the meantime, here’s what we do and don’t know about how Facebook’s changes could play out.How does Facebook plan to increase disclosure of funders of political ads?In his statement, Zuckerberg said that Facebook will start requiring political advertisers to disclose “which page paid for an ad.”This is a reversal for Facebook. In 2011, the company argued to the Federal Election Commission that it would be “inconvenient and impracticable” to include disclaimers in political ads because the ads are so small in size.While the commission was too divided to make a decision on Facebook’s request for an advisory ruling, the deadlock effectively allowed the company to continue omitting disclosures. (The commission has just reopened discussion of whether to require disclosure for internet advertising).Now Facebook appears to have dropped its objections to adding disclosures. However, the problem with Facebook’s plan of only revealing which page purchased the ad is that the source of the money behind the page is not always clear.What is Facebook doing to make political ads more transparent to the public?Zuckerberg also said that Facebook will start to require political advertisers to place on their pages all the ads they are “currently running to any audience on Facebook.”This requirement could mean the end of the so-called “dark posts” on Facebook — political ads whose origins were not easily traced. Now, theoretically, each Facebook political ad would be associated with and published on a Facebook page — either for candidates, political action committees or interest groups.However, the word “currently” suggests that such disclosure could be fleeting. After all, ads can run on Facebook for as little as a few minutes or a few hours. And since campaigns can run dozens, hundreds or even thousands of variations of a single ad — to test which one gets the best response — it will be interesting to see whether and how they manage to display all those ads on their pages simultaneously.“It would require a lot of vigilance on the part of users and voters to be on those pages at the exact time” that campaigns posted all of their ads, said Brendan Fischer, a lawyer at the Campaign Legal Center, a campaign finance reform watchdog group.How will Facebook decide which ads are political?It’s not clear how Facebook will decide which ads are political and which aren’t. There are several existing definitions they could choose from.The Federal Communications Commission defines political advertising as anything that “communicates a message relating to any political matter of national importance,” but those rules only apply to television and radio broadcasters. FCC rules require extensive disclosure, including the amount paid for the ads, the audiences targeted and how many times the ads run. Help Us Monitor Political Ads Online ProPublica launches a “PAC” to scrutinize campaign ads on Facebook. The Federal Election Commission has traditionally defined two major types of campaign ads. “Independent expenditures” are ads that expressly advocate the election or defeat of a “clearly identified candidate.” A slightly broader definition, “electioneering communications,” encompasses so-called “issue ads” that mention a candidate but may not directly advocate for his or her election or defeat.The FEC only requires spending on electioneering ads to be disclosed in the 60 days leading up to a general election or the 30 days leading up to a primary election. And the electioneering communications rule does not apply to online advertising.Of course, Facebook doesn’t have to choose of any of the existing definitions of political advertising. It could do what it did with hate speech — and make up its own rules.How will Facebook catch future political ads secretly placed by foreigners?The law prohibits a foreign national from making any contribution or expenditure in any U.S. election. That means that Russians who bought the ads may have broken the law, but it also means that any American who “knowingly provided substantial assistance” may also have broken the law.Last week, when Facebook disclosed the Russian ad purchase, the company said it was increasing its technical efforts to identify fake and inauthentic pages and to prevent them from running ads.Zuckerberg said the company would “strengthen our ad review process for political ads” but didn’t specify exactly how. (Separately, Facebook Chief Operating Officer Sheryl Sandberg said this week that the company is adding more human review to its ad-buying categories, after ProPublica revealed that it allowed advertisers to target ads toward “Jew haters.”)Zuckerberg also said Facebook will work with other tech companies and governments to share information about online risks during elections.Will ProPublica continue crowd-sourcing Facebook political ads?Yes, we plan to keep using our tool to monitor political advertising. This month, we worked with news outlets in Germany — Spiegel Online, Süddeutsche Zeitung and Tagesschau — to collect more than 600 political ads during the parliamentary elections.We believe there is value to creating a permanent database of political ads that can be inspected by the public, and we intend to track whether Facebook lives up to its promises.If you want to help us, download our tool for Firefox or Chrome web browsers.
The Breakthrough: A Reporter Finds a Man Proven Innocent, But Still Guilty in Eyes of the Law
by Joaquin Sapien For five days, ProPublica reporter Megan Rose hunkered down in a very small, very hot conference room in Las Vegas, surrounded by boxes brimming with legal records. She took notes and scanned documents one page at a time. The grind of investigative reporting, personified.But in those pages lay a big payoff: a story of murder, misadventure and injustice. Listen to the Podcast Rose had come searching for details about the remarkable case of Fred Steese, a drifter wrongfully convicted of killing a circus performer in 1992. It took nearly 20 years for Steese to get out of prison, even though prosecutors had evidence showing he wasn’t guilty, and that he was likely in another state when the murder happened.In October 2012, a judge declared Steese innocent. But Steese wound up pleading guilty nonetheless through something called the Alford plea, an increasingly common, perplexing arrangement where a defendant maintains his innocence, but accepts the status of a convicted felon, and forfeits the right to sue.Rose put it all together in “Kafka in Vegas,” which ran in the May 2017 issue of Vanity Fair.“If you had been a TV writer, somebody — your producer, director — would be like, ‘This is too outlandish. You have to tone it down,’” Rose said, recalling the records from Steese’s original trial. On today’s episode of The Breakthrough, she tells us all about it: how she first met Steese in the parking lot of a rundown Vegas apartment complex, how she persuaded veteran prosecutors to talk to her about a high-profile, highly sensitive case, and, of course, what it was like to be in that conference room.“God, there was just so much,” Rose said. “It’s hard to express just how many pieces of paper that I was going through.”Tune into The Breakthrough, the podcast from ProPublica where investigative reporters reveal how they nailed their biggest stories.
Why Do Border Deaths Persist When the Number of Border Crossings Is Falling?
by George Joseph In July, a sweltering tractor trailer ride in Texas became the latest harrowing example of the perils of crossing the U.S. border illegally. From the hospital, one survivor told authorities that he had paid smugglers to get him across the Rio Grande and then cram him on a northbound truck with what he guessed were nearly 100 people. The survivor managed to keep breathing in the pitch black trailer without food or water. But when the doors were opened in a San Antonio Walmart parking lot, eight migrants were dead, their bodies “lying on the floor like meat,” the truck’s driver subsequently said. Another two expired later.Those 10 deaths are among the 255 known migrant fatalities recorded by the International Organization for Migration in the first eight months of 2017. That’s up from 240 in the same period last year. Experts aren’t certain what’s causing the recent increase; verifying numbers is inherently difficult when it comes to an endeavor whose very mission is to avoid detection by the authorities.However, academics and the U.S. Border Patrol largely agree on the long-term trends, which reveal a clear pattern. Between 1998 and 2016, the number of unauthorized border-crossers who were captured — which is viewed as the best proxy for the rate of illegal crossings — has plunged 70 percent in the southwest U.S. border region, according to data from the Border Patrol. During that same period, yearly immigrant deaths have risen some 20 percent. (The increase in death rate, which was steady for many years, was interrupted for several years by a temporary surge in migrants from Central America, which we’ll explain, only to resume its upward march.)The result is a significant increase in the chances of dying in an illegal border crossing over the past two decades. A key cause: efforts by the Border Patrol to push migrants away from easy-to-cross, hard-to-police urban corridors and into barren, isolated terrain. That’s the conclusion of “Why Border Enforcement Backfired,” a 2016 paper whose lead author, Douglas Massey, is a professor at Princeton’s Woodrow Wilson School of Public and International Affairs and the cofounder of the Mexican Migration Project. A spokesman for the Border Patrol echoed the view that the change in policy contributed to the increase in deaths (but disagreed that the policy backfired).If somebody had been trying to slip across the border through Texas in the early ’90s, he might have just forded a narrow canal or hopped a chain-link fence from Juarez into El Paso. Back then, the vast majority of unauthorized crossings followed easy routes into big cities like El Paso or San Diego, where illegal immigrants could, to the frustration of authorities, quickly blend into the local population. Border deaths were relatively rare, said Daniel Martinez, an assistant professor of sociology at the University of Arizona and a researcher on a project called the Migrant Border Crossing Study.Things began to change when the Clinton administration, seeking to burnish its tough-on-illegal-immigrant credentials, swelled the Border Patrol’s ranks and adopted a strategy known as Prevention Through Deterrence. The initiative, adopted in 1994, clamped down on popular crossing routes through San Diego and El Paso.The document laying out the strategy at the time predicted that “with traditional entry and smuggling routes disrupted, illegal traffic will be deterred, or forced over more hostile terrain, less suited for crossing and more suited for enforcement.” Migrant flow would shift to sectors in South Texas and Tucson, it anticipated, while acknowledging that “illegal entrants crossing through remote, uninhabited expanses of land and sea along the border can find themselves in mortal danger.”That’s precisely what happened when the administration implemented Prevention Through Deterrence. Starting in the mid-’90s, the Border Patrol effectively sealed off the well-traveled crossing paths of the San Diego and El Paso Border Patrol sectors. From 1998 to 2008, deaths in these sectors — which had hovered between 20 and 40 annually — tailed off, eventually dropping to a handful in recent years.Tens of thousands of migrants began shifting to lengthier, more dangerous, unpopulated routes, according to experts. The location of many fatalities shifted accordingly. Memorial crosses decorate the border wall that separates Arizona from Nogales, Mexico. (Susan Schulman/Barcroft Media) Arizona became a hotbed for migrant crossings and deaths in the first years of the new millennium. In the Tucson sector, which stretches over 262 miles of border, much of it desert terrain, migrant fatalities jumped from 11 in 1998 to a peak of 251 in 2010.But as the Border Patrol deployed more resources to the Tucson sector, migrants targeted other entry points and deaths began declining, to 84 last year. (As the sector became more heavily patrolled, the percentage of migrants whose cause of death was overheating and other environmental factors rose, according to University of Arizona researchers who examined autopsy data.)“It’s like a balloon: If you cinch down on the left and the right, it’ll go elsewhere,” said Robert Daniels, a spokesman for the Border Patrol. “So after we cinched down on San Diego and El Paso, that led flow to Arizona. Then, as Arizona was cinched down, that led to flow further south in Texas.”The latter change is visible in recent years in two Texas sectors. The relatively small Laredo area has seen deaths rise from 20 in 1998 to 68 last year. Meanwhile, in the Rio Grande Valley sector, which includes 320 miles of border and some formidable river crossing points, annual deaths rose from 26 in 1998, peaked at 156 in 2013 then tailed off to 130 last year. The Rio Grande is now the most common site of migrant deaths, according to Border Patrol data. Since January 2009, the remains of more than 550 migrants have been found in just one jurisdiction, Brooks County, where migrants attempting to bypass Border Patrol’s inland checkpoints hike for days through dry ranch land, often getting lost and dehydrated in the flat, arid brush.When it implemented the Prevention Through Deterrence policy, the Border Patrol did not anticipate so many people would attempt to cross the deadly terrains left to them, said Doris Meissner, the head of the Immigration and Naturalization Service who signed off on the strategy in 1994. “Border Patrol believed the hostile conditions [in] the really new geographies that had not been typical crossing areas would create their own built-in deterrence, and that didn’t turn out to be true,” said Meissner, now a senior fellow at the Migration Policy Institute. “The shift to those areas happened more quickly than the Border Patrol realized that it would.”The Border Patrol’s Daniels agreed that the extreme climates of migrants’ crossing paths were the primary cause of the increased deaths, but also blamed smugglers. “We saw the smugglers taking the aliens to more remote locations to cross with the thought that there would be no Border Patrol,” said Daniels, who began his career in Tucson in 1994. “I haven’t heard of any theories for this outside of the extreme weather.” Daniels noted that other possible factors, like shootings and general border violence, could not explain the deaths.Once it became clear that environmental deterrence was not stopping migrants, however, authorities did not reverse their strategy. “That always has always been one of the major criticisms,” said Meissner. To make up for the increased risks, she said, the Border Patrol trained agents for emergency response operations and deployed agents, paramedics, helicopters and surveillance equipment to hazardous areas.These rescue effort have saved lives, but they haven’t brought migrant crossing death rates back down to levels seen in the 1990s. The Prevention Through Deterrence strategy “directly led to the exponential increase in deaths in Southern Arizona,” according to Martinez, the researcher on the Migrant Border Crossing Study. “The data speaks for itself: There’s a direct correlation between the border buildup and the deaths. It’s undeniable.” As this shift took place, border crossings dropped regularly, and from 2012 to 2014, so did migrant death rates. But the latter figures were skewed by a surge of migrants from Central American countries at the same time that illegal entries by Mexicans dipped. Many of the Central Americans, fleeing violence in their countries, intentionally placed themselves in U.S. custody in an attempt to seek asylum. Since the migrant death rate is defined as fatalities as a percentage of apprehensions, the spike in apprehensions had the effect of lowering death rates.Since 2014, however, those rates have been on the rise again. Some of the rise in deaths in 2017 may have to do with South Texas’ unique environmental factors, wrote Julia Black, project coordinator for the International Organization for Migration’s Missing Migrants Project, in an email to ProPublica. “It is not yet clear why the migrant death rate has increased this year,” she said. “Some part of this can be attributed to an increase in rainfall, which has led to more deaths in the Rio Grande, but it cannot explain the rise in deaths in e.g. the Arizona desert.”Martinez argued that it is more important to look at the longer-term shifts than trying to identify one or two elements. People have been forced to take ever more demanding and precarious routes.“We’re seeing more and more remains being recovered on trails at higher elevations than ever seen before,” said Martinez. “Rather than crossing for a couple hours, people cross for days, pushed farther away from the pick-up points, so they literally just can’t carry enough water anymore.”
California Regulators Require Auto Insurers to Adjust Rates
by Julia Angwin and Jeff Larson California regulators said they have required Nationwide and USAA to adjust their auto insurance rates as a result of a report by ProPublica and Consumer Reports that many minority neighborhoods were paying more than white areas with the same risk.The regulators said their review confirmed our finding that linked the pricing disparities to incorrect applications of a provision in California law. The statute allows insurers to cluster neighboring zip codes together into a single rating territory.“The companies were making some subjective determinations,” as a basis for calculating rates in some zip codes, said Ken Allen, deputy commissioner of the rate regulation branch of the California Department of Insurance. Nationwide and USAA are two of the 10 largest auto insurance providers in the country by market share.The department said that the adjustments would largely erase the racial disparities we found in the two companies’ pricing. According to our analysis, USAA charged 18 percent more on average, and Nationwide 14 percent more, in poor, minority neighborhoods than in whiter neighborhoods with similarly high accident costs. Allen said it’s not possible to quantify how these adjustments would affect customers’ premiums because the revisions are too complex. In addition, they’re taking effect at the same time as an overall rate increase.Allen said the department is now requiring more justification from insurers for their measurements of risk in the poor, minority neighborhoods that California designates as “underserved” for auto coverage.California’s action marks a rare regulatory rebuke of the insurance industry for its longtime practice of charging higher premiums to drivers living in predominantly minority-urban neighborhoods than to drivers with similar safety records living in majority-white neighborhoods. Insurers have traditionally defended their pricing by saying that the risk is greater in those neighborhoods, even for motorists who have never had an accident.The department’s investigation was prompted by a ProPublica and Consumer Reports analysis published in April of car insurance premiums in California, Texas, Missouri and Illinois. ProPublica found that some major insurers were charging minority neighborhoods rates as much as 30 percent more than in other areas with similar accident costs.The disparities were not as widespread in California, which is a highly regulated insurance market, as in the other states. Even so, within California, we found that units of Nationwide, USAA and Liberty Mutual were charging prices in risky minority neighborhoods that were more than 10 percent above similar risky zip codes where more residents were white. California regulators said they approved rate increases from Nationwide and USAA last week that contained corrections to the disparities revealed by ProPublica. The regulators said they are still investigating the proposed rates of Liberty Mutual, which had the largest disparities in ProPublica’s analysis. Liberty Mutual spokesman Glenn Greenberg said the company is cooperating with the investigation.The rate changes will only affect premiums charged from now on. The insurance commission chose not to look into whether, or the extent to which, drivers in California’s underserved neighborhoods may have been mischarged in the past.Department spokeswoman Nancy Kincaid said there was no need to examine past rates. “After hundreds of hours of additional analysis, department actuaries and analysts did not find any indication the ProPublica analysis revealed valid legal issues,” she said.Some consumer advocates disagreed with this approach. “We think the commissioner should go back and seek refunds for people who were covertly overcharged by the discriminatory practices that ProPublica uncovered,” said Harvey Rosenfield, founder of Consumer Watchdog. Consumers Union, the policy and action arm of Consumer Reports, has also sent a letter to the department, urging it to examine if any rates were calculated improperly in the past.The insurance commissions in Missouri, Texas and Illinois did not respond to questions about whether they had taken any actions to address the disparities highlighted in ProPublica’s article. A spokesman for the Illinois Department of Insurance said in a statement that it urges consumers to shop around for the best price on automobile insurance.ProPublica and Consumer reports analyzed more than 100,000 premiums charged for liability insurance — the combination of bodily injury and property damage that represents the minimum coverage drivers buy in each of the states. To equalize driver-related variables such as age and accident history, we limited our study to one type of customer: a 30-year-old woman with a safe driving record. We then compared those premiums, which were provided by Quadrant Information Services, to the average amounts paid out by insurers for liability claims in each zip code.When ProPublica published its investigation, the California Department of Insurance criticized the article’s approach and findings, saying that “the study’s flawed methodology results in a flawed conclusion” that some insurers discriminate in rate-setting. Nevertheless, the department subsequently used ProPublica’s methodology as a basis for developing a new way to analyze rate filings. It used its new method to examine the recent Nationwide and USAA rate filings.In California, when insurers set rates for sparsely populated rural zip codes, which tend to be relatively white, they are allowed to consider risk in contiguous zip codes of their own choosing. In some cases, these clusters led higher risk zip codes to be assigned a lower risk — and therefore, lower premium prices — than the state’s comprehensive analysis of accident costs warranted. The use of contiguous zip codes is also common in Missouri, Texas and Illinois but is less regulated there than in California.In an interview, deputy insurance commissioner Allen said that Nationwide had made a “procedural error” in its use of the contiguous zip codes provision, and that the regulators required the company to rely more heavily on the state’s risk estimates in those areas.Nationwide acknowledged that the state required a rate adjustment, but disputed the association with ProPublica’s reporting. “It is inaccurate and misleading for anyone to conclude or imply any connection between Nationwide’s recently approved rating plan and ProPublica’s unsubstantiated findings,” spokesman Eric Hardgrove said. He added that Nationwide is committed to nondiscriminatory rates and “disagrees with any assertion to the contrary.”On page 2,025 of Nationwide’s most recent California insurance filing, the company disclosed that it provided premium quotes for the “ProPublica risk example” to the California insurance commission.The improper use of the contiguous zip codes provision was also a factor in the USAA filing, Allen said in an interview. “USAA had failed to apply the updated industry wide factors where they had insufficient data,” he said.USAA spokesman Roger Wildermuth acknowledged when the company filed its rate plan in August 2016, it did not use California’s most up-to-date risk numbers, which were published eight months earlier in December 2015. The reason, he said, was that the insurer had already “completed months of calculations prior to that update.”He noted that the department approved that filing, including USAA’s decision to rely on its own data, and has now approved the company’s revised calculations using updated data.“The department has consistently validated our approach to this rate filing,” he said.California officials said they will more closely police the clustering algorithms, and their impact on poor and minority neighborhoods, as they review future rate filing applications.“We will use this analysis going forward,” said Joel Laucher, chief deputy commissioner of the department. “We don’t need to change any rules to do that.”
Failing Charter Schools Have a Reincarnation Plan
by Annie Waldman This past June, Florida’s top education agency delivered a failing grade to the Orange Park Performing Arts Academy in suburban Jacksonville for the second year in a row. It designated the charter school for kindergarten through fifth grade as the worst public school in Clay County, and one of the lowest performing in the state.Two-thirds of the academy’s students failed the state exams last year, and only a third of them were making any academic progress at all. The school had had four principals in three years, and teacher turnover was high, too.“My fourth grader was learning stuff that my second grader was learning — it shouldn't be that way,” said Tanya Bullard, who moved her three daughters from the arts academy this past summer to a traditional public school. “The school has completely failed me and my children.”The district terminated the academy’s charter contract. Surprisingly, Orange Park didn’t shut down — and even found a way to stay on the public dime. It reopened last month as a private school charging $5,000 a year, below the $5,886 maximum that low-income students receive to attend the school of their choice under a state voucher program. Academy officials expect all of its students to pay tuition with the publicly backed coupons.Reverend Alesia Ford-Burse, an African Methodist Episcopal pastor who founded the academy, told ProPublica that the school deserves a second chance, because families love its dance and art lessons, which they otherwise couldn’t afford. “Kids are saying, ‘F or not, we’re staying,’” she said.While it’s widely known that private schools convert to charter status to take advantage of public dollars, more schools are now heading in the opposite direction. As voucher programs across the country proliferate, shuttered charter schools, like the Orange Park Performing Arts Academy, have begun to privatize in order to stay open with state assistance.A ProPublica nationwide review found that at least 16 failing or struggling charter schools in five states — Florida, Wisconsin, Indiana, Ohio and Georgia — have gone private with the help of publicly funded voucher programs, including 13 since 2010. Four of them specialize in the arts, including Orange Park, and five serve students with special needs.“The voucher just is a pass through in order to provide additional funding for private schools to thrive and to continue to work,” said Addison Davis, superintendent of schools in Clay County. Changing a school’s status “isn’t going to stop the process where we continue to see kids who are declining academically and not being able to demonstrate mastery and proficiency.” The Orange Park Performing Arts Academy was the only charter school in Clay County, Florida, that focused on the arts. (Charlotte Kesl for ProPublica) Two key factors underlie these conversions. The number of voucher and voucher-like programs across the country has more than tripled over the past decade from 16 to 53. And charter schools, which became popular as a way to spur educational innovation with reduced regulation, have increasingly faced more stringent oversight. Jeanne Allen, founder and CEO of the Center for Education Reform and a longtime supporter of charter schools, lamented in a recent op-ed that increased government regulation is turning them into “bureaucratic, risk-averse organizations fixated on process over experimentation.”“Why not just be a private school if the kids qualify for the scholarships?” said Christopher Norwood, a consultant for the Orange Park school, in an interview. “With 90 percent fewer regulations, schools can be independent and free, and just deal with the students.”As private schools, the ex-charters are less accountable both to the government and the public. It can be nearly impossible to find out how well some of them are performing. About half of the voucher and voucher-like programs in the country require academic assessments of their students, but few states publish the complete test results, or use that data to hold schools accountable.While most states have provisions for closing low-quality charter schools, few, if any, have the power to shut down low-performing voucher schools.“Public money is being handed out without oversight,” said Diane Ravitch, a New York University education historian and public schools advocate, who served as assistant secretary of education under President George H.W. Bush. “The fundamental voucher idea is that parents are choosing the schools and they know better than the state. If they want to send their kids to a snake-charming school, then that’s their choice.”The type of voucher program that rescues failed charter schools like Orange Park in Florida may soon be replicated nationwide. Visiting a religious school in Miami last April, Secretary of Education Betsy DeVos praised the state’s approach as a possible model for a federal initiative.Typically, voucher programs are directly funded with taxpayer dollars. Florida’s largest program pursues a different strategy. Its “tax-credit scholarships” are backed by donations from corporations. They contribute to nonprofit organizations, which, in turn, distribute the money to the private schools. In exchange, the donors receive generous dollar-for-dollar tax credits from the state. This subsidy indirectly shifts hundreds of millions of dollars annually from the state’s coffers to private schools. More than 100,000 students whose families meet the income eligibility requirements have received the tax-credit coupons this year.Of the nearly 2,900 private schools in Florida, over 1,730 participated in the tax-credit voucher program during 2016-17, according to the most recent state Department of Education data. On average, each school received about $300,000 last year.While more than two-thirds of these schools are religious, the roundabout funding approach protects the vouchers against legal challenges that they violate the separation of church and state. Earlier this year, the state Supreme Court dismissed a lawsuit by the Florida Education Association, a teacher’s union, challenging the constitutionality of the voucher program.In an education budget proposal from May, DeVos detailed her voucher plans, pitching a $250 million plan to study and expand individual state initiatives. She has since suggested that the administration may also create a federal tax-credit voucher scheme through an impending tax overhaul.School choice advocates like DeVos have long contended that vouchers improve educational opportunities for low-income families. They reason that competition raises school quality, and that parents, given more options, will select the best school for their children.A growing body of research, though, casts doubt on this argument. It shows voucher-backed students may not be performing better than their public school counterparts, and may do worse.A recent Department of Education study compared students who attended private schools with vouchers in Washington, D.C., from 2012 through 2014 with those who qualified for the program but were turned down due to a lack of available slots. The private schoolers performed significantly worse than their public school peers in math, and no better in reading.According to a February 2017 analysis by Martin Carnoy, a Stanford University education professor, most studies of voucher programs over the past quarter-century found little evidence that students who receive the coupons perform better than their public school peers.The lack of evidence on the benefits of vouchers, Carnoy wrote, “suggests that an ideological preference for education markets over equity and public accountability is what is driving the push to expand voucher programs.”Across the Florida panhandle from Orange Park, another troubled charter school for the arts has reinvented itself as a voucher-funded private school.Founded in 2010, the A.A. Dixon Charter School of Excellence had the worst academic record in Escambia County, and the school board raised questions about its financial accounting.“Every month they came before the board and there was a problem,” said Jeff Bergosh, a school board member at the time, adding that he supports school choice. “They tried to make it work, but they didn’t. There were serious issues that jeopardized student safety, like sanitation issues and not having supervision [for the students].”After Dixon received two failing grades from the state — which triggers termination of a school’s charter under Florida rules — Reverend Lutimothy May, a Baptist pastor who chaired its board, appealed to state education authorities. They allowed the school to operate for at least one more year, but he began to seek other options.Around the same time, a local beverage distributor, David Bear of the Lewis Bear Company, told May that he was considering contributing to the state tax-credit program. If the Dixon school privatized, Bear told May, donations could help save it. In 2013, May turned the charter, which had recently been renamed the Dixon School of the Arts, into a private Christian arts academy located inside his church. Nearly all current students at Dixon receive the tax-credit vouchers, bringing the school more than $500,000 a year, according to the most recent data from the state’s department of education.“Our goal is still the same,” but the conversion has “untied some of the strings on education,” May said.Dixon School of the Arts, a private arts academy in Pensacola, Florida. Dixon began as a public charter school, but after receiving two failing grades from the state, it converted to a private school with the help of tax-credit vouchers. (Annie Waldman/ProPublica) Some of the untied “strings” to which May referred were state educational requirements. By converting from a charter to private status, Dixon and other schools largely shield themselves from accountability.For instance, while Florida requires all private schools to test students who receive vouchers, the schools face no consequences for weak academic performance. The University of Florida publishes an annual report analyzing the test scores of students that receive vouchers, but data from only a small fraction of the schools is made public. The report excludes many schools that don’t have test results for enough students in consecutive years.The latest report released the academic performance of only 198 schools in 2014-15, out of the more than 1,500 schools that enrolled voucher-funded students that year. Most Florida families that receive vouchers do not have access to test data on their schools. The Dixon data was not published. Dixon’s principal, Donna Curry, maintained that the school has improved since its conversion from charter status, but declined to provide exam results to ProPublica, saying they were “for internal use.”Curry added that state test results are not necessarily reflective of student success. “I will not accept the fact that our children are not learning because they are not normalized on the state test,” she said. Her staff “knows more than what the test evaluates.”The state also has little control over how private, voucher-funded schools foster learning. There are no requirements on curriculum or teacher certification, other than the criminal background checks that are required for personnel at all private schools.Because Dixon receives more than $250,000 in voucher money, it does have to file a financial accountability report. Only about 40 percent of all voucher-funded schools met this threshold to undergo such an audit in 2016. The reports, including Dixon’s, aren’t publicly posted.Even an official at Step Up For Students, the largest nonprofit distributor of voucher money to Florida’s private schools, acknowledges the need for closer supervision of educational quality. “As the program matures and more students are enrolled and as inevitably we see some schools continue to have what most people would consider to be poor performance year-in and year-out, we will be having more and more discussions about whether there should be some kind of regulatory accountability mechanisms to respond to that,” said Ron Matus, the organization’s director of policy and public affairs.Indiana’s largest voucher program, unlike Florida’s, is directly backed by taxpayer dollars and has stricter accountability requirements. A private school that accepts vouchers can be sanctioned if its performance dips low enough. Last year, 10 schools lost their access to new vouchers, according to Adam Baker, the spokesman for the Indiana Department of Education.The tighter supervision, though, didn’t deter Padua Academy in Indianapolis. Originally a private Catholic school, Padua had become a “purely secular” charter in 2010, under an unusual arrangement between the local archdiocese and the mayor’s office. The school initially performed well, but soon sank from a solid A-rating to two consecutive F-ratings.“These performance issues sounded alarm bells at the mayor's office,” said Brandon Brown, who led the mayor’s charter office at the time. Leadership issues with the school’s board and at the archdiocese, he added, caused the school to falter. After receiving $702,000 from a federal program that provided seed money for new charter schools, the school’s board relinquished its charter.In the meantime, Indiana had established a voucher program. So, instead of shutting down, the school rebranded itself as St. Anthony Catholic School, nailing its crucifixes back onto the walls and bringing the Bible back into the curriculum. Last year, more than 80 percent of its students were on vouchers, from which the school garnered at least $1.2 million.Its academic performance has improved, but still lags behind the state average. Only 25 percent of St. Anthony students passed both math and reading assessments this year, versus about half of all publicly funded students on average at both private and public schools, according to the state’s education data from 2017. Last year, the state gave St. Anthony a C grade.Gina Fleming, superintendent of schools for the Archdiocese of Indianapolis, said through a spokesman that “significant staff turnover” at St. Anthony’s “made for a difficult start these past two years.” As a result, the archdiocese “has been studying ways in which we can recruit, retain and reward high-quality teachers and leaders.” It has also “made shifts in scheduling, resources, diagnostic analyses and personnel to better accommodate the learning needs of our students.” In Fort Wayne, Indiana, two other charter schools went private. Both Imagine MASTer Academy and Imagine Schools on Broadway were associated with a national for-profit charter chain, Imagine Schools, which has been under scrutiny elsewhere. In 2012, the Missouri Board of Education shut down all six Imagine charter schools in St. Louis for financial and academic woes. In response to such setbacks, Imagine Schools has moved toward “an even deeper commitment to increasing the consistency of our network-wide performance,” said Rhonda Cagle, a spokeswoman for the chain.The two Fort Wayne schools performed well initially, but by the time their charters were up for renewal, they had some of the worst test results in the area, said Robert Marra, executive director of the charter office at Ball State University, which was responsible for the schools’ oversight. Imagine MASTer received a D grade from the state in 2013 and Imagine Schools on Broadway, an F.The data for the two schools “showed clear room for improvement but indicated consistent growth,” Cagle told ProPublica.In 2013, Imagine merged its two failing charters with a local parochial school, Horizon Christian Academy. Since then, the Christian academy’s enrollment has soared from 23 students to 492. About 430 students paid their tuition with the help of state vouchers last year, totaling about $2.4 million in public funds.While some of Imagine’s students and staff have stayed on, Cagle said that Imagine has no involvement in the merged academy, other than owning the building.“We could have allowed the buildings to just be empty, but we felt like if there was an interest by another entity for the purposes of education, that would be doing the right thing,” she said. Imagine “does not utilize vouchers for any of our schools,” she added.Academically, Horizon Christian is far below average. Only 7 percent of its students passed both state exams this year, according to state data. One of its campuses received a D grade last year, and its other two failed. The academy did not respond to questions.“Low-performing operators in Indiana and elsewhere have skirted accountability by converting their charter schools to private schools either right before or right after a charter revocation or nonrenewal,” said Brown, the former Indianapolis official. “I can say unequivocally that any attempt to keep a low-performing school open by evading rigorous accountability is not good for students, families, or the broader school choice movement.”“Sometimes when you're knocked down the hardest, you come back the hardest,” said Kelly Kenney, who started as the new principal of the Orange Park Performing Arts Academy this year, after the district terminated its charter contract this summer. (Charlotte Kesl for ProPublica) As it awaits its first infusion of voucher funds later this month, the Orange Park Performing Arts Academy is strapped. The district has repossessed most of the former charter school’s instructional supplies, including 200 Chromebooks, 34 laptops, 27 iPads and hundreds of textbooks. The arts — the school’s core mission — have been cleaned out: ten easels, nine digital pianos, eight heartwood djembes and four conga drums, all gone. Once lined with silver bleachers, the walls of the cavernous gym are now bare.Many children have left, too. While the school had about 170 students last year, only 94 enrolled this fall. At least one quarter are kindergarteners, who didn’t attend the charter school. Tanya Bullard, who pulled her three daughters out of Orange Park, predicted it would slide further as a private school, because there will be “no one to keep an eye on it and issues will be swept under the rug.”The school’s new principal, Kelly Kenney, isn’t deterred. She said that she has already made significant strides to separate the school from its failed days as a charter. Most of the teachers and administrators are new hires, although half of the teachers are uncertified. Kenney plans to get the school accredited, and strengthen the board of directors. “It can’t be a board of friends,” she said. She has been working with each teacher individually to raise standards and improve curriculum.“Most people would have been defeated,” Kenney said. “Sometimes when you're knocked down the hardest, you come back the hardest. And so for parents that have been skeptical, I'm like ‘This will be the best year of education your child will ever have. We're going to be looking at every detail of their progress, every detail of their learning gap to make sure that we're closing it.’”Even though it’s not required, Kenney intends to publish her students’ performance data on the school’s website. “It’s important for us to show how we did compared to last year,” she said.To recruit students this past summer, Kenney went door to door in nearby apartment complexes, hosting information sessions in laundry rooms. Believing that they couldn’t afford a private school, many families were reluctant to send their children to Orange Park — until Kenney told them about vouchers. For weeks, she and her staff have worked around the clock to sign up all the students in the voucher program, even helping them organize, fill out and fax in the necessary paperwork.Bria Joyce is a loyalist. When her son started kindergarten at the local public school, she says he was “bumping heads” with classmates and she worried that he wasn’t receiving enough attention from teachers. She transferred him to the Orange Park charter school, where he took piano lessons and played Grandpa Joe in a production of “Charlie and the Chocolate Factory.”When Joyce heard that the school was converting to a private school, she was nervous that she wouldn’t be able to afford the tuition. But the school reached out to her immediately and walked Joyce through the voucher process. Now Joyce’s son is starting fourth grade there.“They were prepared and made it as easy as they could, considering everything,” she said. “I believe in what they’re trying to get done.”
Attorneys General in 37 States Urge Insurance Industry to Do More to Curb Opioid Epidemic
by Charles Ornstein Attorneys general for 37 states sent a letter Monday to the health insurance industry’s main trade group, urging its members to reconsider coverage policies that may be fueling the opioid crisis.The letter is part of an ongoing investigation by the state officials into the causes of the opioid epidemic and the parties that are most responsible. The group is also focusing on the marketing and sales practices of drug makers and the role of drug distributors.On Sunday, ProPublica and The New York Times reported that many insurance companies limit access to pain medications that carry a lower risk of addiction or dependence, even as they provide comparatively easy access to generic opioid medications. The safer drugs are more expensive.In their letter to America’s Health Insurance Plans, the trade group based in Washington, D.C., the attorneys general urged insurers to revise their rules “to encourage healthcare providers to prioritize non-opioid pain management options over opioid prescriptions for the treatment of chronic, non-cancer pain.”“The status quo, in which there may be financial incentives to prescribe opioids for pain which they are ill-suited to treat, is unacceptable,” the letter said. “We ask that you quickly initiate additional efforts so that you can play an important role in stopping further deaths.”The signatories include the attorneys general of California, Florida, New York, Pennsylvania and Michigan.While opioids, such as hydrocodone and morphine, are often prescribed to relieve pain, they also have been linked to abuse and dependence. Drug overdoses are now the leading cause of death among Americans under 50, and more than 2 million Americans are estimated to misuse opioids. While the crisis has placed the practices of drug makers, pharmaceutical distributors, pharmacies and doctors under scrutiny, the role of insurers in enabling access to cheap, addictive opioids has received less attention.The Department of Health and Human Services is now studying whether insurance companies make opioids more accessible than other pain treatments. An early analysis suggests that insurers are placing fewer restrictions on opioids than on less addictive, non-opioid medications and non-drug treatments like physical therapy, said Christopher M. Jones, a senior policy official at the department.Last week, the New York state attorney general’s office sent letters to the three largest pharmacy benefit managers — CVS Caremark, Express Scripts and OptumRx — asking how they were addressing the crisis.In a written statement to ProPublica, Cathryn Donaldson, a spokeswoman for America’s Health Insurance Plans, said that, “We share the state attorneys general’s commitment to eradicating the opioid epidemic in America.”“Health plans cover comprehensive, effective approaches to pain management that include evidence-based treatments, more cautious opioid prescribing, and careful patient monitoring,” Donaldson wrote. “Recent research shows that non-opioid medications, even over-the-counter medication like ibuprofen, can provide just as much relief as opioids.”Insurers say they have been addressing the issue on many fronts, including monitoring patients’ opioid prescriptions, as well as doctors’ prescribing patterns. A number of companies say they have seen marked declines in monthly opioid prescriptions in the past year or so. Moreover, at least two large pharmacy benefit managers, which run insurers’ drug plans, announced this year that they would limit coverage of new prescriptions for pain pills to a seven- or 10-day supply.“Patients and their care providers should talk openly and honestly about pain and how to manage it — from lifestyle changes and exercise to over-the-counter options and clearly understanding the dangers of opioids,” Donaldson said. Nonetheless, ProPublica and The New York Times found that companies are sometimes refusing to cover less risky drugs prescribed by doctors while putting no such restrictions on opioids.We analyzed Medicare prescription drug plans covering 35.7 million people in the second quarter of this year. Only one-third of the people covered, for example, had any access to Butrans, a painkilling skin patch that contains a less-risky opioid, buprenorphine. And every drug plan that covered lidocaine patches, which are not addictive but cost more than other generic pain drugs, required that patients get prior approval from the insurer for them.Moreover, we found that many plans make it easier to get opioids than medications to treat addiction, such as Suboxone. Drug plans covering 33.6 million people include Suboxone, but two-thirds require prior authorization. And even if they do approve coverage, some insurance companies have set a high out-of-pocket cost for Suboxone, rendering it unaffordable for many addicts, a number of pharmacists and doctors said.“Everyone — including and especially insurance companies — have an obligation to address the opioid epidemic,” New York Attorney General Eric T. Schneiderman said in a press release today. “Insurers must take a hard look at the systemic problems in our healthcare system that result in the over-prescription of opioids and fuel the cycle of addiction.”
The Trumps Say They’re Opening Hotels in Dallas, Nashville and Elsewhere. We Couldn’t Find Evidence of Them.
by Matt Drange, Forbes, Alan Huffman, special to ProPublica, and Derek Kravitz, ProPublica Earlier this summer, the Trump Organization announced big plans to open a line of hotels across the country. The new brand, American IDEA, would be modestly priced and patriotically themed. “The product is very hometown and fits in every hometown in the United States,” Trump Hotels CEO Eric Danziger said during a presentation at Trump Tower in Manhattan, the same place where Donald Trump had announced his presidential campaign two years earlier.American IDEA would be part of a wider rollout with another higher-end hotel line, Scion, that the Trumps had already unveiled. Progress on the hotels would be swift, Danziger said.The Trump Organization had said it signed deals for Scion hotels in Nashville, Dallas, Cincinnati, Austin and New York. At various times, company officials have cited anywhere from 10 to 39 impending deals.The Trumps declined to release any details about the deals. The Trump Organization wouldn’t name the developers partnering with it, or where the planned hotels would be. So we asked readers and journalists to help us figure out who the president’s company was working with and where.What we’ve found are false starts, fizzled-out partnerships and, for a number of cities that the Trumps said they had deals in, no evidence of deals at all. We Found New Details About the New Trump-Branded Hotels. Now We Want Your Help to Find the Rest. We’re recruiting local reporters and civically engaged citizens. We have a few ideas on how you can find these deals, who to talk to about them, and what documents to look for. Nashville faced petitions after the Trump Organization said it was coming to town. But development and tourism officials we spoke to said they were unaware of any Trump hotel being planned. Bobby Bowers, senior vice president of operations for Hendersonville, Tennessee-based hotel industry research firm STR, said his company has no information about a Trump hotel partnership in Nashville, even among its “unconfirmed” listings. A spokesperson for the city’s convention and visitors bureau said the same thing.In Dallas, a developer who had been working with the Trumps had declared the deal dead two months before the Trump Organization identified the city as a hotel site. (He also had plans for a Trump hotel in downtown St. Louis before political pressure and protests derailed it.)The developer, Mukemmel “Mike” Sarimsakci, did not respond to a request for comment. If the plan is back on with Sarimsakci or a different partner in Dallas, city officials don’t appear to know about it. Requests for correspondence between the city and representatives of the Trump Organization, as well as requests submitted to Dallas’ Office of Economic Development, turned up no records.Officials and hotel developers in Cincinnati also said they had not heard of any deals involving Trump.And in Austin, the deal “died before Trump was elected,” the head of a firm that had been working on the project told the Austin Business Journal. “It’s absolutely 100 percent dead.”Danziger declined to comment for this story. Other representatives for the Trump Organization’s hotel business did not respond to requests for comment.As we previously detailed, the Trumps are moving forward on four hotels in the Mississippi Delta. The deals are in partnership with a pair of Indian-American hoteliers, one of whom had met Donald Trump on the campaign trail and later gave money to his presidential campaign.Suresh Chawla met Trump at a private fundraiser in August 2016 and donated $50,000, split between Trump’s campaign and the Republican National Committee. Months later, Chawla, along with his business partner and brother Dinesh, reached an agreement with the Trump Organization on a $20 million Scion hotel and three other franchise agreements to convert existing hotels to the American IDEA brand.We also found a few other cities where the Trumps have had early conversations about partnering with local developers.Jon Willis, a politically active developer in Mesa, Arizona, said he met Donald Trump Jr. through a mutual connection at Turning Point USA, a nonprofit group that promotes conservative causes, and started working on the Trump campaign last year. When Willis spent time with Donald Jr. at a campaign event in Arizona last year, he said they discussed expansion plans that the Trump Organization had in Las Vegas, where it has a condo-hotel tower in partnership with billionaire Phil Ruffin. “That was the extent of what we talked about,” Willis said, adding that the two “mostly just talked about our kids.”Willis added that while he wasn’t working with the Trumps on their new hotel line, he would be more than open to it: “I’d love to be involved.”Three other established hoteliers and financiers in the South told us they’d also welcome working with the Trumps. The Trump Organization has said it is meeting with potential partners in Mississippi.Len Blackwell, an attorney in Gulfport, Mississippi, said he had heard rumors of the Trumps “poking around” on the coast. (The Trump Organization has said it is meeting with potential partners in Mississippi.)Blackwell has had experience working with the Trumps. He represented Trump in a planned $80 million casino and hotel project in Gulfport in the mid-1990s. Trump abandoned the deal before ground was broken.One issue, according to Blackwell, was that Trump’s representatives were reticent about following through on a required $250,000 deposit they had negotiated with the city.“My experience with the Trump Organization and its attempt to put a casino in Gulfport was: Its representatives, including Mr. Trump, came to town and had a lot of public relations activity, and did in fact work toward a project but, when it came down to it, chose not to go forward,” he said.
Why Are Drug Prices So High? We’re Curious, Too.
by Katie Thomas, The New York Times and Charles Ornstein, ProPublica This much is clear: The public is angry about the skyrocketing cost of prescription drugs. Surveys have shown that high drug prices rank near the top of consumers’ health care concerns.What’s not as clear is exactly why prices have been rising, and who is to blame.For the last four months, The New York Times and ProPublica, the nonprofit investigative journalism organization, have teamed up to answer these questions, and to shed light on the games that are being played to keep prices high, often without consumers’ knowledge or consent. Katie reports from the health desk at The Times, and Charles is a senior reporter at ProPublica.Our reporting journey has turned up some counterintuitive stories, like how insurance companies sometimes require patients to take brand-name drugs — and refuse to cover generic alternatives — even when that means patients have to pay more out of pocket.Along the way, we’ve asked readers to share their stories about their struggles with high drug costs. We’ve heard from nearly 1,000 people.In recent weeks, a few stories caught our eye. A woman in Texas, for example, told us that the company that manages her drug benefits, OptumRx, was going to start asking her to pay more out of pocket for Butrans, a painkilling patch that contains the drug buprenorphine. As a “lower cost alternative,” OptumRx, which is owned by UnitedHealth Group, suggested she try painkillers like OxyContin, even though they carry a higher risk of dependence. A letter sent by OptumRx, a pharmacy benefit manager, to a member in Texas, suggesting she consider switching from the Butrans painkilling skin patch to drugs that carry a higher risk of abuse and dependence. (Letter obtained by ProPublica) “The whole point of pain management is to take the least amount of medication possible to manage your pain, so that you always have somewhere to go when the pain increases or changes,” she wrote to us. “This is irresponsible and scary ‘cost management.’” She did not want to use her name, saying her employer prohibited her from identifying herself, but she allowed us to share OptumRx’s redacted letter.Her pharmacy benefit manager, she wrote, is “effectively contributing to the ‘opioid crisis’ with its own policies.”A spokesman for UnitedHealth, Matthew N. Wiggin, said it takes the crisis seriously and wants to ensure that people with chronic pain get the appropriate treatment.We’ve closely followed the opioid crisis and efforts to hold various parties accountable, among them drug manufacturers, pharmacies and emergency room doctors.But these stories — about patients who believed their insurers were placing roadblocks in the way of less risky painkillers — felt new to us.We followed up with several of the readers, and searched social media to see if other patients were talking about this. Then we asked for documents: billing statements from insurers, denial letters, call logs and doctors’ records. In the case of our lead example, a woman named Alisa Erkes, she also agreed to sign a privacy waiver allowing her insurer, UnitedHealthcare, to comment on her case.Charles enlisted ProPublica’s deputy data editor, Ryann Grochowski Jones, to analyze data from Medicare prescription drug plans. The results showed that insurers were indeed placing more barriers to drugs like Butrans and lidocaine patches than to cheaper generic opioids.Insurers say that they are doing their part by placing limits on new prescriptions for addictive painkillers, and that they are also doing more to monitor doctors’ prescribing patterns and to catch abuse by patients. Several insurers said they had seen declines in monthly opioid prescriptions, a sign of progress.But their behavior has infuriated many patients, who say they want to avoid taking opioids if possible. They argue that insurers are too focused on a drug’s cost, since many of the painkillers with a lower risk of addiction are more expensive.Our project examining high drug costs is not over. We are already digging into other corners of the prescription drug world, hoping to shed light on more of the hidden forces that are keeping drug costs high. Stay tuned, as well, for more stories that were inspired by our readers.
Amid Opioid Crisis, Insurers Restrict Pricey, Less Addictive Painkillers
by Katie Thomas, The New York Times and Charles Ornstein, ProPublica At a time when the United States is in the grip of an opioid epidemic, many insurers are limiting access to pain medications that carry a lower risk of addiction or dependence, even as they provide comparatively easy access to generic opioid medications.The reason, experts say: Opioid drugs are generally cheap while safer alternatives are often more expensive.Drugmakers, pharmaceutical distributors, pharmacies and doctors have come under intense scrutiny in recent years, but the role that insurers — and the pharmacy benefit managers that run their drug plans — have played in the opioid crisis has received less attention. That may be changing, however. The New York state attorney general’s office sent letters last week to the three largest pharmacy benefit managers — CVS Caremark, Express Scripts and OptumRx — asking how they were addressing the crisis.ProPublica and The New York Times analyzed Medicare prescription drug plans covering 35.7 million people in the second quarter of this year. Only one-third of the people covered, for example, had any access to Butrans, a painkilling skin patch that contains a less-risky opioid, buprenorphine. And every drug plan that covered lidocaine patches, which are not addictive but cost more than other generic pain drugs, required that patients get prior approval for them.In contrast, almost every plan covered common opioids and very few required any prior approval.The insurers have also erected more hurdles to approving addiction treatments than for the addictive substances themselves, the analysis found.Alisa Erkes lives with stabbing pain in her abdomen that, for more than two years, was made tolerable by Butrans. But in January, her insurer, UnitedHealthcare, stopped covering the drug, which had cost the company $342 for a four-week supply. After unsuccessfully appealing the denial, Erkes and her doctor scrambled to find a replacement that would quiet her excruciating stomach pains. They eventually settled on long-acting morphine, a cheaper opioid that UnitedHealthcare covered with no questions asked. It costs her and her insurer a total of $29 for a month’s supply. Erkes, who is 28, is afraid of becoming addicted and has asked her husband to keep a close watch on her. “Because my Butrans was denied, I have had to jump into addictive drugs,” she said. (Kevin D. Liles for The New York Times) The Drug Enforcement Administration places morphine in a higher category than Butrans for risk of abuse and dependence. Addiction experts say that buprenorphine also carries a lower risk of overdose.UnitedHealthcare, the nation’s largest health insurer, places morphine on its lowest-cost drug coverage tier with no prior permission required, while in many cases excluding Butrans. And it places Lyrica, a non-opioid, brand-name drug that treats nerve pain, on its most expensive tier, requiring patients to try other drugs first.Erkes, who is 28 and lives in Smyrna, Georgia, is afraid of becoming addicted and has asked her husband to keep a close watch on her. “Because my Butrans was denied, I have had to jump into addictive drugs,” she said.UnitedHealthcare said Erkes had not exhausted her appeals, including the right to ask a third party to review her case. It said in a statement, “We will work with her physician to find the best option for her current health status.”Matthew N. Wiggin, a spokesman for UnitedHealthcare, said that the company was trying to reduce long-term use of opioids. “All opioids are addictive, which is why we work with care providers and members to promote non-opioid treatment options for people suffering from chronic pain,” he said.Dr. Thomas R. Frieden, who led the Centers for Disease Control and Prevention under President Obama, said that insurance companies, with few exceptions, had “not done what they need to do to address” the opioid epidemic. Right now, he noted, it is easier for most patients to get opioids than treatment for addiction. Read More Take the Generic Drug, Patients Are Told — Unless Insurers Say No Faced with competition, some pharmaceutical companies are cutting deals with insurance companies to favor their brand-name products over cheaper generics. Insurers pay less, but sometimes consumers pay more. Leo Beletsky, an associate professor of law and health sciences at Northeastern University, went further, calling the insurance system “one of the major causes of the crisis” because doctors are given incentives to use less expensive treatments that provide fast relief.The Department of Health and Human Services is studying whether insurance companies make opioids more accessible than other pain treatments. An early analysis suggests that they are placing fewer restrictions on opioids than on less addictive, non-opioid medications and non-drug treatments like physical therapy, said Christopher M. Jones, a senior policy official at the department.Insurers say they have been addressing the issue on many fronts, including monitoring patients’ opioid prescriptions, as well as doctors’ prescribing patterns. “We have a very comprehensive approach toward identifying in advance who might be getting into trouble, and who may be on that trajectory toward becoming dependent on opioids,” said Dr. Mark Friedlander, the chief medical officer of Aetna Behavioral Health who participates on its opioid task force.Aetna and other insurers say they have seen marked declines in monthly opioid prescriptions in the past year or so. At least two large pharmacy benefit managers announced this year that they would limit coverage of new prescriptions for pain pills to a seven- or 10-day supply. And bowing to public pressure — not to mention government investigations — several insurers have removed barriers that had made it difficult to get coverage for drugs that treat addiction, like Suboxone.Experts in addiction note that the opioid epidemic has been changing and that the problem now appears to be rooted more in the illicit trade of heroin and fentanyl. But the potential for addiction to prescribed opioids is real: 20 percent of patients who receive an initial 10-day prescription for opioids will still be using the drugs after a year, according to a study by researchers at the University of Arkansas for Medical Sciences.Several patients said in interviews that they were terrified of becoming dependent on opioid medications and were unwilling to take them, despite their pain.In 2009, Amanda Jantzi weaned herself off opioids by switching to the more expensive Lyrica to treat the pain associated with interstitial cystitis, a chronic bladder condition.But earlier this year, Jantzi, who is 33 and lives in Virginia, switched jobs and got a new insurer — Anthem — which said it would not cover Lyrica because there was not sufficient evidence to prove that it worked for interstitial cystitis. Jantzi’s appeal was denied. She cannot afford the roughly $520 monthly retail price of Lyrica, she said, so she takes generic gabapentin, a related, cheaper drug. She said it does not manage the pain as well as Lyrica, which she took for eight years. “It’s infuriating,” she said.Jantzi said she wanted to avoid returning to opioids. However, “I could see other people, faced with a similar situation, saying, ‘I can’t live like this, I’m going to need to go back to painkillers,’” she said.In a statement, Anthem said that its members have to meet certain requirements before it will pay for Lyrica. Members can apply for an exception, the insurer said. Jantzi said she did just that and was turned down. Erkes, who is petting her dog, Kallie, once visited her pain doctor every two months. Since her insurer denied coverage of Butrans, she has gone back much more frequently, and once went to the emergency room because she could not control her pain. (Kevin D. Liles for The New York Times) With Butrans, the drug that Erkes was denied, several insurers either do not cover it, require a high out-of-pocket payment, or will pay for it only after a patient has tried other opioids and failed to get relief.In one case, OptumRx, which is owned by UnitedHealth Group, suggested that a member taking Butrans consider switching to a “lower cost alternative,” such as OxyContin or extended-release morphine, according to a letter provided by the member.Wiggin, the UnitedHealthcare spokesman, said the company’s rules and preferred drug list “are designed to ensure members have access to drugs they need for acute situations, such as post-surgical care or serious injury, or ongoing cancer treatment and end of life care,” as well as for long-term use after alternatives are tried.Butrans is sold by Purdue Pharma, which has been accused of fueling the opioid epidemic through its aggressive marketing of OxyContin. Butrans is meant for patients for whom other medications, like immediate-release opioids or anti-inflammatory pain drugs, have failed to work, and some scientific analyses say there is not enough evidence to show it works better than other drugs for pain.Dr. Andrew Kolodny is a critic of widespread opioid prescribing and a co-director of opioid policy research at the Heller School for Social Policy and Management at Brandeis University. Kolodny said he was no fan of Butrans because he did not believe it was effective for chronic pain, but he objected to insurers suggesting that patients instead take a “cheaper, more dangerous opioid.”“That’s stupid,” he said.
Experts Say the Use of Private Email by Trump’s Voter Fraud Commission Isn’t Legal
by Jessica Huseman President Donald Trump’s voter fraud commission came under fire earlier this month when a lawsuit and media reports revealed that the commissioners were using private emails to conduct public business. Commission co-chair Kris Kobach confirmed this week that most of them continue to do so.Experts say the commission’s email practices do not appear to comport with federal law. “The statute here is clear,” said Jason R. Baron, a lawyer at Drinker Biddle and former director of litigation at the National Archives and Records Administration.Essentially, Baron said, the commissioners have three options: 1. They can use a government email address; 2. They can use a private email address but copy every message to a government account; or 3. They can use a private email address and forward each message to a government account within 20 days. According to Baron, those are the requirements of the Presidential Records Act of 1978, which the commission must comply with under its charter.“All written communications between or among its members involving commission business are permanent records destined to be preserved at the National Archives,” said Baron. “Without specific guidance, commission members may not realize that their email communications about commission business constitute White House records.”ProPublica reviewed dozens of emails to and from members of the commission as well as written directives on records retention. The commissioners appear to have been given no instructions to use government email or copy or forward messages to a government account.Commissioner Matthew Dunlap, the secretary of state for Maine, confirmed that he’d received no such directives. “That’s news to me,” he said, when read the PRA provision governing emails. “I think it would be a little cleaner if I had a us.gov email account.”Dunlap’s account is disputed by Andrew Kossack, the executive director of the commission. Kossack said attorneys from the Government Services Administration provided training on the PRA before the commission’s first meeting on July 19. Kossack provided a copy of the PowerPoint presentation. However, the word “email” appears in only a single slide — with no mention of anything relating to the use of government email.Notably, the commission did not receive any training in records retention until the July 19 meeting, even though the commission was formed in May and had been actively engaged in commission business.Indeed, the commission had kicked into high gear on June 28, when it sent a letter to all 50 secretaries of state requesting publicly available voter rolls. The response was swift and negative, and commissioners began receiving a wave of messages from election officials and the public.Despite this, the commissioners were offered no instructions then on how to preserve communications. Baron said such messages would presumptively be considered presidential records, and “the obligation to preserve such records would have arisen on day one.”In a statement, Kossack denied there is an obligation to provide commissioners with government email addresses. He maintained that the commission is required only to “preserve emails and other records related to work on commission matters, regardless of the forum on which the records are created or sent, which the commission and its members are doing.”After the commission’s most recent meeting, on Tuesday, Kobach confirmed that he plans to continue to use his personal gmail account to conduct commission business. Using his Kansas secretary of state email address, he said, would be a “waste of state resources” as he’s acting as a private citizen on the commission and not in his role as secretary of state.Dunlap has interpreted the requirements differently. He’s trying to ensure his state email account is used so that emails can be made available to constituents under Maine state law. Even this is a struggle, he said, asserting that commissioners continue to email him at his personal account despite multiple requests that they send email to his government account.“I really don’t understand why they keep using my personal Gmail account instead of my official state email. But I’m saving everything!” Dunlap wrote to himself on August 7, when he forwarded a communication from the commission to his government address. He has, it appears, continued to immediately forward all emails sent to his personal address by the commission to his state address.At ProPublica’s request, Dunlap shared every email he has received or sent relating to the commission. The majority went to personal email accounts.At their recent meeting in New Hampshire, Kossack provided commissioners printed instructions on how to retain their own emails related to a lawsuit filed against the commission by the Lawyers Committee for Civil Rights Under Law.Dunlap said these instructions are the only written set of instructions on records retention he recalls receiving. (The instructions leave records retention entirely to the discretion of each member of the commission, which Dunlap said concerns him.)Past commissions with similar missions were not allowed such wide discretion. The Presidential Commission on Election Administration, formed by the Obama administration in March 2013, provided ethics and records retention training days after commissioners were nominated. Each commissioner was provided with a federal email address that automatically archived all messages. PCEA documents show extensive, specific instructions on records retention and compliance with FACA.Richard Painter, who served as the George W. Bush administration’s chief ethics lawyer from 2005 to 2007, expressed shock that the current commission is being allowed to rely on personal email accounts (which are to be forwarded to Kossack at their discretion). “This is just sloppy,” he said, adding that waiting more than two months to offer ethics training was just another sign that the Trump administration “doesn’t take ethics training seriously.”One footnote: Among the emails provided by Dunlap was a message from Carter Page, a former policy adviser to the Trump campaign who has reportedly attracted the attention of investigators probing the Russia imbroglio. Page sent an email on July 5 to three accounts associated with Kobach and cc’d Dunlap, New Hampshire Secretary of State Bill Gardner and Indiana Secretary of State Connie Lawson. In it, he implored the commission to investigate “the Obama administration’s misuse of federal resources of the Intelligence Community in their unjustified attacks on myself and other volunteers who peacefully supported [Trump’s] campaign as private citizens.”“The work of your commission offers an essential opportunity to take further steps toward helping to further restore the integrity of the American democracy following their abuses of last year,” he wrote.There is no evidence this email was forwarded to a federal email account. Page, Kossack and Kobach did not respond to requests for comment about the email.
Facebook Moves to Prevent Advertisers From Targeting Haters
by Daniel Golden In the wake of ProPublica’s report Thursday that Facebook advertisers could have directed pitches to almost 2,300 people interested in “Jew hater” and other anti-Semitic topics, the world’s largest social network said it would no longer allow advertisers to target groups identified by self-reported information.“As people fill in their education or employer on their profile, we have found a small percentage of people who have entered offensive responses,” the company said in a statement. “…We are removing these self-reported targeting fields until we have the right processes in place to prevent this issue.”Facebook had already removed the anti-Semitic categories — which also included “How to burn jews” and “History of ‘why jews ruin the world’” — after we asked the company about them earlier this week. Then, after our article was published, Slate reported that Facebook advertisers could target people interested in other topics such as “Kill Muslim Radicals” and “Ku-Klux-Klan.” Facebook’s algorithm automatically transforms people’s self-reported interests, employers and fields of study into advertising categories.Because audiences in the hateful categories were “incredibly low,” the ad campaigns targeting them reached “an extremely small number of people,” Facebook said. Its statement didn’t identify the advertisers. Conceivably, those who might find it helpful to target anti-Semites could range from recruiters for far-right groups to marketers of Nazi memorabilia. ProPublica documented that the anti-Semitic ad categories were real by paying $30 to target those groups with three “promoted posts” — in which a ProPublica article or post was displayed in their news feeds. Facebook approved all three ads within 15 minutes.Facebook’s advertising has become a focus of national attention since it disclosed last week that it had discovered $100,000 worth of ads placed during the 2016 presidential election season by “inauthentic” accounts that appeared to be affiliated with Russia.Like many tech companies, Facebook has long taken a hands-off approach to its advertising business. Unlike traditional media companies that select the audiences they offer advertisers, Facebook generates its ad categories automatically based both on what users explicitly share with Facebook and what they implicitly convey through their online activity.Traditionally, tech companies have contended that it’s not their role to censor the internet or to discourage legitimate political expression. In the wake of the violent protests in Charlottesville by right-wing groups that included self-described Nazis, Facebook and other tech companies vowed to strengthen their monitoring of hate speech.Facebook CEO Mark Zuckerberg wrote at the time that “there is no place for hate in our community,” and pledged to keep a closer eye on hateful posts and threats of violence on Facebook. “It’s a disgrace that we still need to say that neo-Nazis and white supremacists are wrong — as if this is somehow not obvious,” he wrote.
Independent Monitors Found Benzene Levels After Harvey Six Times Higher Than Guidelines
by Lisa Song and Al Shaw, ProPublica, and Kiah Collier, The Texas Tribune
Facebook Enabled Advertisers to Reach ‘Jew Haters’
by Julia Angwin, Madeleine Varner and Ariana Tobin Want to market Nazi memorabilia, or recruit marchers for a far-right rally? Facebook’s self-service ad-buying platform had the right audience for you.Until this week, when we asked Facebook about it, the world’s largest social network enabled advertisers to direct their pitches to the news feeds of almost 2,300 people who expressed interest in the topics of “Jew hater,” “How to burn jews,” or, “History of ‘why jews ruin the world.’”To test if these ad categories were real, we paid $30 to target those groups with three “promoted posts” — in which a ProPublica article or post was displayed in their news feeds. Facebook approved all three ads within 15 minutes.After we contacted Facebook, it removed the anti-Semitic categories — which were created by an algorithm rather than by people — and said it would explore ways to fix the problem, such as limiting the number of categories available or scrutinizing them before they are displayed to buyers.“There are times where content is surfaced on our platform that violates our standards,” said Rob Leathern, product management director at Facebook. “In this case, we’ve removed the associated targeting fields in question. We know we have more work to do, so we’re also building new guardrails in our product and review processes to prevent other issues like this from happening in the future.”Facebook’s advertising has become a focus of national attention since it disclosed last week that it had discovered $100,000 worth of ads placed during the 2016 presidential election season by “inauthentic” accounts that appeared to be affiliated with Russia.Like many tech companies, Facebook has long taken a hands off approach to its advertising business. Unlike traditional media companies that select the audiences they offer advertisers, Facebook generates its ad categories automatically based both on what users explicitly share with Facebook and what they implicitly convey through their online activity.Traditionally, tech companies have contended that it’s not their role to censor the Internet or to discourage legitimate political expression. In the wake of the violent protests in Charlottesville by right-wing groups that included self-described Nazis, Facebook and other tech companies vowed to strengthen their monitoring of hate speech.Facebook CEO Mark Zuckerberg wrote at the time that “there is no place for hate in our community,” and pledged to keep a closer eye on hateful posts and threats of violence on Facebook. “It’s a disgrace that we still need to say that neo-Nazis and white supremacists are wrong — as if this is somehow not obvious,” he wrote.But Facebook apparently did not intensify its scrutiny of its ad buying platform. In all likelihood, the ad categories that we spotted were automatically generated because people had listed those anti-Semitic themes on their Facebook profiles as an interest, an employer or a “field of study.” Facebook’s algorithm automatically transforms people’s declared interests into advertising categories.Here is a screenshot of our ad buying process on the company’s advertising portal: This is not the first controversy over Facebook’s ad categories. Last year, ProPublica was able to block an ad that we bought in Facebook’s housing categories from being shown to African-Americans, Hispanics and Asian-Americans, raising the question of whether such ad targeting violated laws against discrimination in housing advertising. After ProPublica’s article appeared, Facebook built a system that it said would prevent such ads from being approved.Last year, ProPublica also collected a list of the advertising categories Facebook was providing to advertisers. We downloaded more than 29,000 ad categories from Facebook’s ad system — and found categories ranging from an interest in “Hungarian sausages” to “People in households that have an estimated household income of between $100K and $125K.”At that time, we did not find any anti-Semitic categories, but we do not know if we captured all of Facebook’s possible ad categories, or if these categories were added later. A Facebook spokesman didn’t respond to a question about when the categories were introduced.Last week, acting on a tip, we logged into Facebook’s automated ad system to see if “Jew hater” was really an ad category. We found it, but discovered that the category — with only 2,274 people in it — was too small for Facebook to allow us to buy an ad pegged only to Jew haters.Facebook’s automated system suggested “Second Amendment” as an additional category that would boost our audience size to 119,000 people, presumably because its system had correlated gun enthusiasts with anti-Semites. Facebook Doesn’t Tell Users Everything It Really Knows About Them The site shows users how Facebook categorizes them. It doesn’t reveal the data it is buying about their offline lives. Instead, we chose additional categories that popped up when we typed in “jew h”: “How to burn Jews,” and “History of ‘why jews ruin the world.’” Then we added a category that Facebook suggested when we typed in “Hitler”: a category called “Hitler did nothing wrong.” All were described as “fields of study.”These ad categories were tiny. Only two people were listed as the audience size for “how to burn jews,” and just one for “History of ‘why jews ruin the world.’” Another 15 people comprised the viewership for “Hitler did nothing wrong.”Facebook’s automated system told us that we still didn’t have a large enough audience to make a purchase. So we added “German Schutzstaffel,” commonly known as the Nazi SS, and the “Nazi Party,” which were both described to advertisers as groups of “employers.” Their audiences were larger: 3,194 for the SS and 2,449 for Nazi Party.Still, Facebook said we needed more — so we added people with an interest in the National Democratic Party of Germany, a far-right, ultranationalist political party, with its much larger viewership of 194,600.Once we had our audience, we submitted our ad — which promoted an unrelated ProPublica news article. Within 15 minutes, Facebook approved our ad, with one change. In its approval screen, Facebook described the ad targeting category “Jew hater” as “Antysemityzm,” the Polish word for anti-Semitism. Just to make sure it was referring to the same category, we bought two additional ads using the term “Jew hater” in combination with other terms. Both times, Facebook changed the ad targeting category “Jew hater” to “Antisemityzm” in its approval.Here is one of our approved ads from Facebook: A few days later, Facebook sent us the results of our campaigns. Our three ads reached 5,897 people, generating 101 clicks, and 13 “engagements” — which could be a “like” a “share” or a comment on a post.Since we contacted Facebook, most of the anti-Semitic categories have disappeared.Facebook spokesman Joe Osborne said that they didn’t appear to have been widely used. “We have looked at the use of these audiences and campaigns and it’s not common or widespread,” he said.We looked for analogous advertising categories for other religions, such as “Muslim haters.” Facebook didn’t have them.
The Trump Administration Plans to End a Refugee Program for Children
by Marcelo Rochabrun The Trump administration plans to stop accepting refugee applications from children with U.S.-based parents from three violence-riddled Central American countries — El Salvador, Honduras and Guatemala — according to the summary of a presentation the State Department made recently to refugee organizations.The decision to end the Central American Minors program, which began in 2014 and is the only refugee program aimed at helping people from that region, could put hundreds of families split between two countries in a delicate situation.The children will no longer be able to come legally to the U.S. Of course, they can still attempt to cross without authorization and then either request asylum or try to navigate the border region without being detained or injured — just the kind of dangerous illegal immigration that the CAM program was meant to discourage. (And if the children do cross the border, as ProPublica recently reported, they could expose their parents to an investigation for child smuggling.)“Ending the program would force desperate children into the arms of smugglers and traffickers because they don’t have a safe and orderly way to get to the U.S.,” said Lisa Frydman, a vice president of Kids In Need Of Defense, an immigration advocacy group. “This administration is giving the unconscionable message that Central American children are not welcome here for protection.”Refugee organizations were alerted to the impending demise of CAM two weeks ago by State Department officials, according to a memo summarizing the meeting that was obtained by ProPublica.“We were told that [the State Department Bureau of Population, Refugees and Migration] will begin winding down the CAM program in its entirety,” according to the summary, which circulated at one resettlement agency. “Please note that this information was conveyed to us in person (verbally) with no documentation that we can share with you at this time … the CAM refugee program will be discontinued no later than December 31, 2017, perhaps sooner.”A State Department spokesperson said that “all aspects of the FY2018 resettlement program are under review” but added that “no decisions have been made.” Asked about the meeting with the refugee agencies, the spokesperson responded, “The State Department works closely with its resettlement partners and shares information as part of an ongoing dialogue and partnership. No formal announcement has been made to partners regarding the CAM program.”CAM admissions had already dwindled to a trickle. In August, 19 Central American refugees were admitted. By comparison, 160 were admitted last December, the single highest month. Over the history of the program, 1,627 refugees entered the U.S. through CAM, the overwhelming majority of them from El Salvador.In August, the Trump administration terminated a program that served as a sort of back-up to CAM. The program allowed children who failed to qualify as refugees to be allowed into the U.S. temporarily if they could show there was a compelling humanitarian reason. (Obtaining refugee status requires demonstrating a “well-founded fear of persecution for reasons of race, religion, nationality, political opinion or membership in a particular social group.” The definition of “humanitarian” is much broader.) That program allowed 1,465 minors to travel to the U.S. before its cancellation.An additional 2,500 who were approved for the humanitarian program but had yet to make it to the U.S. had those approvals rescinded. “No more individuals will travel into the United States under this … program,” according to a letter from the U.S. Citizenship and Immigration Services agency that announced the cancellation. “As such, USCIS is rescinding your condition approval.”So far this year, Central American refugees accounted for just 1 percent of the 51,000 refugees who have been admitted to the United States. Latin America overall accounts for only 3 percent of the total.“The CAM refugee program has been a small but an incredibly critical lifeline for Central American children,” Frydman said. Relatives of Undocumented Children Caught Up in ICE Dragnet In a shift from how it operated during the Obama administration, Immigration and Customs Enforcement is cracking down on relatives who let undocumented kids stay with them after entering the U.S. The cancellation of CAM is one of many moves the Trump administration has taken to discourage immigration from Latin America.This month, the Trump administration announced the phaseout of DACA, a program for 800,000 young undocumented immigrants who are overwhelmingly from Mexico and Central America. Earlier this year, the Department of Homeland Security announced that it will soon end protections from deportation for 50,000 Haitians, and floated the possibility of doing the same with 200,000 Salvadorans, 60,000 Hondurans, and 3,000 Nicaraguans by next March.DHS has also sought to detain all asylum applicants, who are mostly from Venezuela and Central America, until their cases are adjudicated, which can take years. And it has sought to swiftly deport all illegal border crossers, overwhelmingly Mexicans and Central Americans, to Mexico, even if they aren’t Mexican.The agency has endorsed slashing legal immigration by half. VICE reported this week that next year the U.S. will accept a historically low number of refugees from around the world.The CAM program was launched in 2014 amid an exponential surge of Central American children who crossed the U.S.-Mexico border illegally, most of them claiming they had parents or other relatives in the U.S. To qualify for CAM, parents must be legally allowed to be in the U.S. and children must pass a DNA test proving they are the offspring of the person or people in question. (The tests cost the families close to $600.) The process takes an average of 13 months and about 75 percent of the refugee applications were denied.It’s unclear how many applications are pending, but the number is likely to be in the thousands, based on figures from 2016. It’s also unclear what will happen to pending applications once the cancellation of the program takes effect.“Usually, there is an attempt to have an orderly wind down and people who would be in the pipeline would be completed, their cases would be completed,” said Doris Meissner, a senior fellow at the Migration Policy Institute and a commissioner of the Immigration and Naturalization Service under Bill Clinton. “But we’ve certainly seen in others aspects of what the new administration has done, that they haven’t necessarily being so orderly.”
Rethinking the ‘Infrastructure’ Discussion Amid a Blitz of Hurricanes
by Andrew Revkin The wonky words infrastructure and resilience have circulated widely of late, particularly since Hurricanes Harvey and Irma struck paralyzing, costly blows in two of America’s fastest-growing states.Resilience is a property traditionally defined as the ability to bounce back. A host of engineers and urban planners have long warned this trait is sorely lacking in America’s brittle infrastructure.Many such experts say the disasters in the sprawling suburban and petro-industrial landscape around Houston and along the crowded coasts of Florida reinforce the urgent idea that resilient infrastructure is needed more than ever, particularly as human-driven climate change helps drive extreme weather.The challenge in prompting change — broadening the classic definition of “infrastructure,” and investing in initiatives aimed at adapting to a turbulent planet — is heightened by partisan divisions over climate policy and development.Of course, there’s also the question of money. The country’s infrastructure is ailing already. A national civil engineering group has surveyed the nation’s bridges, roads, dams, transit systems and more and awarded a string of D or D+ grades since 1998. The same group has estimated that the country will be several trillion dollars short of what’s needed to harden and rebuild and modernize our infrastructure over the next decade.For fresh or underappreciated ideas, ProPublica reached out to a handful of engineers, economists and policy analysts focused on reducing risk on a fast-changing planet.Alice Hill, who directed resilience policy for the National Security Council in the Obama administration, said the wider debate over cutting climate-warming emissions may have distracted people from promptly pursuing ways to reduce risks and economic and societal costs from natural disasters.She and several other experts said a first step is getting past the old definition of resilience as bouncing back from a hit, which presumes a community needs simply to recover.“I don’t think of resilience in the traditional sense, in cutting how long it takes to turn the lights back on,” said Brian Bledsoe, the director of the Institute for Resilient Infrastructure Systems at the University of Georgia. “Resilience is seizing an opportunity to move into a state of greater adaptability and preparedness — not just going back to the status quo.”In thinking about improving the country’s infrastructure, and provoking real action, Bledsoe and others say, language matters.Bledsoe, for instance, is exploring new ways to communicate flood risk in words and maps. His institute is testing replacements for the tired language of 1-in-100 or 1-in-500-year floods. A 100-year flood has a 1 in 4 chance of occurring in the 30-year span of a typical home mortgage, he said, adding that’s the kind of time scale that gets people’s attention.Visual cues matter, too, he said. On conventional maps, simple lines marking a floodplain boundary often are interpreted as separating safe zones and those at risk, Bledsoe said. But existing models of water flows don’t provide the full range of possible outcomes: “A 50-year rain can produce a 100-year flood if it falls on a watershed that’s already soaked or on snowpack or if it coincides with a storm surge.”“The bright line on a map is an illusion,” he said, particularly in flat places like Houston, where a slight change in flood waters can result in far more widespread inundation. Risk maps should reflect that uncertainty, and wider threat.Nicholas Pinter, a University of California, Davis, geoscientist who studies flood risk and water management, said that Florida is well-situated to build more wisely after this disaster because it already has a statewide post-disaster redevelopment plan and requires coastal communities to have their own.It’s more typical to have short-term recovery plans — for digging out and getting the lights back on, as 20,000 utility workers are scurrying to do right now.The advantage of having an established protocol for redevelopment, he said, is it trims delays.“Draw up plans when the skies are blue and pull them off the shelf,” he said of how having rebuilding protocols in place can limit repeating mistakes. “That fast response cuts down on the horrible lag time in which people typically rebuild in place.” The rebuilt levee wall that was destroyed during Hurricane Katrina, in the Lower Ninth Ward of New Orleans, Louisiana (Chris Graythen/Getty Images) In a warming climate, scientists see increasing potential for epic deluges like the one that swamped Houston and last year’s devastating rains around Baton Rouge, Louisiana. How can the federal government more responsibly manage such environmental threats?Many people point to the National Flood Insurance Program, which was created to boost financial resilience in flood zones, but has been criticized from just about every political and technical vantage point as too often working to subsidize, instead of mitigate, vulnerability.As has happened periodically before, pressure is building on Congress to get serious about fixing the program (a reauthorization deadline was just pushed from this month toward the end of the year).How this debate plays out will have an important impact on infrastructure resilience, said Pinter of the University of California, Davis. If incentives remain skewed in favor of dangerous and sprawling development, he said, that just expands where roads, wires, pipelines and other connecting systems have to be built. “Public infrastructure is there in service of populations,” he said.He also said the lack of federal guidance has led to deeply uneven enforcement of floodplain building at the state level, with enormous disparities around the country resulting in more resilient states, in essence, subsidizing disaster-prone development in others.“Why should California, Wyoming or Utah be paying the price for Houston, Mississippi or Alabama failing to enforce the National Flood Insurance Program? ” he said.Bledsoe, at the University of Georgia, said there’s no need to wait for big changes in the program to start making progress. He said the National Flood Insurance Program has a longstanding division, the Community Rating System, that could swiftly be expanded, cutting both flood risk and budget-breaking payouts. It’s a voluntary program that reduces flood insurance rates for communities that take additional efforts beyond minimum standards to reduce flood damage to insurable property.Despite the clear benefits, he said, only one municipality, Roseville, California, has achieved the top level of nine rankings and gotten the biggest insurance savings — 45 percent. Tulsa, Oklahoma, Fort Collins, Colorado, King County, Washington, and Pierce County, Washington, are at the second ranking and get a 40 percent rate cut. Hundreds of other municipalities are at much lower levels of preparedness.“Boosting participation is low-hanging fruit,” Bledsoe said.Some see signs that the recent blitz of hurricanes is reshaping strategies in the Trump White House. President Donald Trump’s infrastructure agenda, unveiled on August 15, centered on rescinding Obama-era plans to require consideration of flood risk and climate change in any federal spending for infrastructure or housing and the like. The argument was built around limiting perceived red tape.After the flooding of Houston less than two weeks later, Trump appointees, including Tom Bossert, the president’s homeland security adviser, said a new plan was being developed to insure federal money would not increase flood risks.On Monday, as Irma weakened over Georgia, Bossert used a White House briefing to offer more hints of an emerging climate resilience policy, while notably avoiding accepting climate change science: “What President Trump is committed to is making sure that federal dollars aren’t used to rebuild things that will be in harm’s way later or that won’t be hardened against the future predictable floods that we see. And that has to do with engineering analysis and changing conditions along eroding shorelines but also in inland water and flood-control projects.”Robert R.M. Verchick, a Loyola University law professor who worked on climate change adaptation policy at the Environmental Protection Agency under Obama, said federal leadership is essential.If Federal Emergency Management Agency flood maps incorporated future climate conditions, that move would send a ripple effect into real estate and insurance markets, forcing people to pay attention, he said. If the federal government required projected climate conditions to be considered when spending on infrastructure in flood-prone areas, construction practices would change, he added, noting the same pressures would drive chemical plants or other industries to have a wider margin of safety.“None of these things will change without some form of government intervention. That’s because those who make decisions on the front end (buying property, building bridges) do not bear all the costs when things go wrong on the back end,” he wrote in an email. “And on top of that, human beings tend to discount small but important risks when it seems advantageous in the short-run.”After a terrible storm, he said, most Americans are willing to cheer a government that helps communities recuperate. But people should also embrace the side of government that establishes rules to avoid risk and make us safer. That’s harder, he said, because such edicts can be perceived by some as impinging on personal freedom.“But viewed correctly, sensible safeguards are part of freedom, not a retreat from it,” he said. “Freedom is having a home you can return to after the storm. Freedom is having a bridge high enough to get you to the hospital across the river. Freedom is not having your house surrounded by contaminated mud because the berm at the neighboring chemical plant failed overnight.” Thaddeus R. Miller, an Arizona State University scientist who helps lead a national research network focused on “Urban Resilience to Extreme Events,” said in an email that boosting the capacity of cities to stay safe and prosperous in a turbulent climate requires a culture shift as much as hardening physical systems:“Fundamentally, we must abandon the idea that there is a specific standard to which we can control nature and instead understand that we are creating complex and increasingly difficult-to-control systems that are part social, part ecological and part technological. These mean not just redesigning the infrastructure, but redesigning institutions and their knowledge systems.”After the destruction and disruption from Hurricane Sandy, New York City didn’t just upgrade its power substations and subway entrances, Miller said in a subsequent phone call. The city also rebooted its agencies’ protocols and even job descriptions. “Every time a maintenance crew opens a sewer cover, fixes or installs a pipe, whether new or retrofitting, you’re thinking how to enhance its resilience,” Miller said.Miller said another key to progress, particularly when federal action is limited or stalled, is cooperation between cities or regions. Heat was not an issue in Oregon historically, Miller said, but it’s becoming one. The light rail system around Portland was designed to work with a few 90-degree days a year, he said. “The last couple of summers have seen 20-plus 90-degree days,” he said, causing copper wires carrying power for the trains to sag and steel rails to expand in ways that have disrupted train schedules. Similar rail systems in the Southwest deal with such heat routinely, said Miller, who has worked in both regions. The more crosstalk, the better the outcome, he said.“At the broadest level, we need to think about risks and how infrastructure is built to withstand them at a landscape level,” Miller added. “We can longer commit to evaluating the impacts and risks of a single project in isolation against a retrospective, stationary understanding of risk (e.g., the 100-year flood we’ve been hearing so much about.)”He said that an emerging alternative, “safe-to-fail” design, is more suited to situations where factors contributing to extreme floods or other storm impacts can’t be fully anticipated. “Safe-to-fail infrastructure might allow flooding, but in ways that are designed for,” he said.(With an Arizona State colleague, Mikhail Chester, Miller offered more details in a commentary published last week by The Conversation website, laying out “six rules for rebuilding infrastructure in an era of ‘unprecedented’ weather events.”)Deborah Brosnan, an environmental and disaster risk consultant, said the challenge in making a shift to integrating changing risks into planning and investments is enormous, even when a community has a devastating shock such as a hurricane or flood or both:“It requires a radical shift in how we incorporate variability in our planning and regulations,” she said. “This can and will be politically difficult. New regulations like California fire and earthquake codes and Florida’s building codes are typically enacted after an event, and from a reactive ‘make sure this doesn’t happen again’ perspective. The past event creates a ‘standard’ against which to regulate. Regulations and codes require a standard that can be upheld, otherwise decisions can be arbitrary and capricious. For climate change, non-stationarity would involve creating regulations that take account of many different factors and where variability has to be included. Variability (uncertainy) is the big challenge for these kinds of approaches.”Stephane Hallegatte, the lead economist at the Word Bank’s Global Facility for Disaster Reduction and Recovery, has written or co-written a host of reports on strategies for limiting impacts of climate change and disasters, particularly on the poor. When asked in an email exchange what success would look like, he said the World Bank, in various recent reports, has stressed the importance of managing disaster risks along two tracks: both designing and investing to limit the most frequent hard knocks and then making sure the tools and services are available to help communities recover when a worst-case disaster strikes.He added: “Facing a problem, people tend to do one thing to manage it, and then forget about it. (‘I face floods; I build a dike; I’m safe.’) We are trying to work against this, by having risk prevention and contingent planning done together.”
ProPublica and Texas Tribune Project on Dangers of Hurricanes to Houston a Finalist for North American Digital Media Award
by ProPublica The World Association of Newspapers and News Publishers announced today that “Boomtown, Flood Town,” a collaboration between ProPublica and the Texas Tribune, is a finalist for the North American Digital Media Award in the Best Data Visualization category.The multimedia project — by a team of local reporters and data journalists including ProPublica’s Al Shaw, along with The Texas Tribune’s Kiah Collier, and Neena Satija of the Texas Tribune and Reveal — was part of a series that presciently showed the risk to Houston of hurricanes and floods with the potential to devastate the region.Published last year, the project served as an interactive, immersive call to action before such a storm hit, using excellent science journalism and cutting-edge technology to tell the story in a new way. It took a closer look at how the loss of undeveloped prairie and wetlands was making areas that had not flooded in decades more prone to inundation. The story also exposed the dangers of a bureaucratic nightmare in Houston: a process plagued by politicians passing the buck, and by the strange psychology of large disasters, which are often considered academic problems until it’s far too late.With the recent catastrophic flooding in Houston from Hurricane Harvey, the reporting of “Boomtown, Flood Town” is increasingly urgent. This week, Houston Mayor Sylvester Turner gave his strongest endorsement to date for constructing a physical barrier to protect the region from deadly storm surges during hurricanes.Winners for the North American Digital Media Awards will be announced in October. Read more about the award here.
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