MMPI GETS $1 MILLION PER QUARTER WITH NO DETAILS

I find the way MMPI bills Cuyahoga County for its monthly “fee” an example of bad management taken to extreme. The billings tell the County nothing of what MMPI does for its healthy fee.

 

Here’s what the entire “invoice” from MMPI says as a description of what it did for $333,333.33 – or a penny shy of $1 million every three months:

“Const. Mgmt/Developer fee - $333,333.33. Total due $333,333.33.”

 

That’s it. Pretty much a blank sheet of paper.

 

No mention of what work might have been done. No mention of how many people did what. No mention of money paid out by MMPI. No mention of hours worked. Not a shred of documentation. Nothing. Nada.

 

Now that’s the way to be able to bill a client. Sweet.

 

Just take our word for it, says MMPI. We’ve been giving you $333,333.33 worth of service this month. And on every 15th of the month the bill comes. And we pay. Now, since March, MMPI has pocketed $2.3 plus million. So every quarter another $1 million goes from the County to MMPI on a fee basis.

 

You’d think that Tim Hagan would have learned the lesson from Gateway when he and Mike White allowed the construction of the arena to go forward BEFORE they got the signature of George and Gordon Gund on line to occupy the Gateway arena.

 

Having started construction, the Gunds had them over a barrel. And they rolled that barrel over and over again until they got as sweet a sweetheart deal as one could get. Now Dan Gilbert enjoys the same sugary deal.

 

MMPI, Hagan warns now, could walk away from the Medical Mart/Convention Center deal.

 

Wish that they would.

 

That $80 million or so collected on the quarter percent sale tax increase could go for better uses. Might even bring Public Auditorium to its former state.

 

The County also has a letter from MMPI attesting to other costs, $2,443,573 from “its pre-construction design building and various consultants for performing work on the feasibility plans, as described in Section 2.3 of the Development Agreement dated April 16, 2009, according to a July 15th letter to the County’s project director Barbara Shergalis. This is based on a request I made for documentation of billing.

 

The County does have backup documentation describing the different tasks that require $2.4 million in payment.

 

But this loose “fee” of a third of a million bucks every three months, worked out by the County and Fred Nance of Squire, Sanders & Dempsey, strikes me as the kind of an accounting that skips accounts. It allows a profit without a clear explanation of what the clients – we taxpayers – are getting for our money.

 

Hagan likes this kind of accounting for his friends of the Kennedy clan. The rest of us shouldn’t. It becomes more unacceptable as time goes by.