"Miami Ethics: New link of profits, politics at airport"

Saturday, October 5, 2002

New link of profits, politics at airport
BY RONNIE GREENE AND JOE MOZINGO
The Miami (FL) Herald


Her office sits shuttered, high weeds and wrecked cars littering the
decaying business strip north of Liberty City. The state of Florida
forbids her from hiring employees until she pays her taxes. A judge says
she is liable in a $150,000 embezzlement scheme.

Yet Linda Forrest retains a piece of the largest public works contract
in Miami-Dade County history. Every month, she is wired nearly $50,000
for her role as one of eight partners overseeing Miami International
Airport's $5 billion expansion.

What, if any, work Forrest has done as part of the Dade Aviation
Consultants team is murky. How she has remained in the airport job even
as her own employees accused her of fraud is another question.

What is clear, The Herald found: Forrest won her share of this coveted
contract as she was cutting a quiet deal to pay an estimated $77,000 a
year from her airport earnings to the brother of former Miami-Dade Mayor
Stephen P. Clark.

Mayor Clark seconded the motion to award the contract to Dade Aviation
Consultants. While Forrest and the seven other DAC partners stood to
reap a windfall, the vote also steered money to Richard W. Clark, the
late mayor's brother and one-time business partner.

The deal shows how an inexperienced firm was able to earn millions from
the public construction contract after cutting in a politician's
brother. It also raises questions about whether political ties, rather
than the public good, influenced who was chosen to oversee the expansion
of MIA, one of the largest airport construction projects in the United
States.

At the dawn of the job in 1993, Forrest agreed to pay Richard Clark a 7
percent cut of her MIA revenue in return for his help opening doors at
County Hall. The deal was not publicly disclosed, and Clark kept his
name off the initial paperwork.

Forrest, a black contractor, was included in the DAC contract ostensibly
to help boost minority business development at the county-owned airport.
She had not previously run a business.

Yet a portion of airport money meant for a minority-owned company
actually went to a wealthy white businessman and former state legislator
who was Democratic majority leader in the 1970s. Her agreement with
Richard Clark and her company's subsequent bankruptcy illustrate how
side deals can undermine the intent of a program meant to cultivate
local minority businesses.

''The money should go to the companies that are contracted to do the
work and do the work, no one else,'' said Christopher Mazzella,
Miami-Dade's inspector general. ``Our concern is that firms that are
duly qualified have an opportunity to do business in Miami-Dade
County.''

Forrest was, no doubt, a real contractor looking to expand her business.
Yet her Forrest Construction Management became buried in debt, forcing
her to work from her Surfside home.

Clark, by contrast, is able to afford a vacation home on Florida's Gulf
Coast and a lakeside estate in the Blue Ridge Mountains of North
Carolina.

Clark declined all requests for comment. At the door of his
Hendersonville, N.C., home, his wife said he would have nothing to say.
Clark later declined to respond to written questions sent to his Miami
attorney.

NO INTERVIEWS

Forrest won't talk, submits brief statement

When reporters knocked on Forrest's door recently, she said she couldn't
talk and turned away. She later provided brief written answers to
questions from The Herald.

Did she hire Clark's firm for its political connections? ``No.''

''I hired a corporation for purposes of business development and
assistance in acquiring financing to support my participation in DAC,''
she wrote.

While no longer working together, they remain connected through
litigation. Clark's company, Airport Information, has sued Forrest to
collect money he alleges is still owed to his firm.

Clark's arrangement with Forrest reveals one more way in which the giant
airport contract -- already worth more than $140 million -- feeds the
county's political machine. DAC has spent millions of its earnings
hiring lobbyists to keep it in good standing at County Hall, and on
political fundraisers and charity events hosted by politicos.

The job to oversee Miami's airport expansion was so lucrative that even
before it was put to bid, companies and their lobbyists plotted to pick
the right mix of partners to lock votes on the County Commission.

The Clarks' longtime family friend, lobbyist Rodney Barreto, helped
pitch the eight companies that became the DAC team, and he has been a
strategist for them since. Barreto has a long roster of county clients
and raises big money for politicians, including Miami-Dade Mayor Alex
Penelas. DAC alone has paid his lobbying firm more than $1.3 million.

As DAC came together, Barreto introduced Forrest to Arthur Teele, the
only black commissioner at the time.

''They were trying to get votes,'' Teele said. ``Rodney was clearly her
advocate.''

Forrest said Barreto was a lobbyist for the entire team and ushered her
and others to meet commissioners. Barreto said he did not recall the
meeting with Teele.

Teele thought that Forrest, who had received her contractor's license
less than two years before, was the least qualified of the DAC minority
partners, even as she was slated to get as big a share of profit as two
others.

Forrest Construction had two employees at the time -- she was one of
them -- and not enough money to pay health benefits, records show.
According to her résumé, she did have some experience at MIA, as a
project manager for a contractor, preparing bid documents and
coordinating subcontractors.

She was joining a team, meanwhile, led by companies with international
reach: Bechtel Corp., Day & Zimmermann and Spillis Candela & Partners.

With its construction expertise, minority partners and lobbying muscle,
DAC won the contract in December 1992, with Mayor Clark seconding
then-Commissioner Penelas' motion. The commission debate that day
centered heavily on the role minority vendors would play. A competitor
contended that DAC was making a ''cosmetic'' commitment, but DAC said
its minority participation was real. Penelas and Clark voiced support,
and Teele ultimately joined the 7-2 majority.

It was a rich victory. The airport agreed to pay nearly two and a half
times what it cost DAC to pay its employees. Because expenses were
limited -- the airport provided the consultant with office space,
computers, phones, insurance -- there were big profits.

The eight partners share these profits, with the three largest companies
getting the bulk, and the five smaller ones splitting 19 percent. Each
firm is paid based on the number of its people working for DAC.

The whole purpose of hiring a consultant like DAC -- and paying it so
much more than airport staff earned -- was to bring the private firms'
expertise to oversee the airport expansion.

Yet Forrest didn't even have to provide employees to get into the
contract. Instead, DAC managers assigned a handful of applicants to her.
All she had to do was pay their checks and provide their benefits, and
MIA would effectively reimburse her a 142 percent markup.

In the first year, Forrest contributed none of the seven DAC employees
working for her. In later years, she complained that she didn't have a
say in who worked for her.

To date, Forrest Construction Management has been paid $5.8 million, its
share of DAC's fees.

A LIMITED ROLE

Local knowledge is called partner's principal asset 

Yet records show that Forrest's role has been limited, at best.

''The personal involvement of Linda Forrest with DAC is limited to her
involvement in the Joint Venture Board meetings and her involvement in
the administration of her employees,'' DAC program manager Mark Massman
wrote in response to a Herald question.

``I have no records of Linda Forrest being personally involved in DAC
work products or in billing directly to the project.''

Massman said that Forrest's prime asset was her knowledge of local job
candidates and subcontractors, which out-of-town partners lacked, and
that she later helped find half a dozen job candidates for a variety of
positions at DAC.

Those limited duties left her plenty of time to pursue other
construction projects, though DAC was her prime money flow. She operated
her business from modest office quarters on Northwest 78th Street,
paying just $380 a month in rent.

Still, she ran deeply into debt.

Early on, a chunk of her airport profits went to Richard Clark's firm.
In January 1993, one month after his brother seconded the motion to hire
DAC, Clark's Airport Information signed an agreement with Forrest
Construction.

His firm would get 7 percent of her total airport revenue, ''with the
consultant's primary duties being to assist Forrest in marketing its
services and obtaining maximum public relations value from the
project,'' the contract says. He would introduce her to local decision
makers.

Clark's company was actually dissolved at the time. The contract said it
would reactivate to collect checks from Forrest -- and noted that
Airport Information had ''already fulfilled'' most of its duties when it
signed the agreement.

Clark himself did not sign the agreement. His partner, Ralph Rocheteau,
a former assistant county attorney with political pull of his own, did.

Rocheteau did not join Clark in the later lawsuit. Now, he says Clark
did nothing to earn his money. ''He didn't do crap for her,'' Rocheteau
said. ``He did nothing.''

Forrest agreed. ''Richard Clark never introduced me to anyone,'' she
wrote. Clark's current attorney and partner, Michael Getelman,
disagreed. ``We did do public relations and we did do consulting work.
We gave her the knowledge of how to weave her way.''

The contract was to last one year, but the parties agreed to extend it
until 1997, after Clark guaranteed two lines of credit for Forrest
totaling $80,000.

Clark's lawsuit says Forrest paid his firm $71,425 and still owes
$163,968, including interest.

Even with the steady flow of money from the airport, Forrest couldn't
pay her bills, saying she hit hurdles in other construction jobs that
delayed payments to her company. ''Things back up,'' she testified in
her company's bankruptcy case. ``You pay Peter or you don't pay Paul.''

She also had problems at DAC.

SERIES OF COMPLAINTS

Partner's employees fumed; then came 'civil theft' case

Her airport employees began complaining about paychecks coming in late,
or about checks that didn't clear. In 1998, they complained to DAC's
managers in a memo that a Forrest employee turned up at a doctor's
appointment ``only to find out that the employee could not be seen by
the doctor due to disenrollment because of nonpayment of premiums.''

The employees fumed that Forrest deducted money from their checks for
insurance payments, but didn't pay the bill.

''Since this money was fraudulently removed from our paychecks with the
intent to pay the insurance carrier, and because you did not do this,
then you have breached the contractual agreement you had with us,''
employees wrote in a follow-up letter to Forrest on Nov. 17, 1998.

That year, Forrest Construction filed for bankruptcy protection after
running up a $55,000 debt to the Internal Revenue Service and listing
total liabilities of $155,701. But a judge later dismissed the case.

Soon, the lawsuits started mounting.

Last year, insurance company Casualty Reciprocal Exchange accused
Forrest of playing a major role in ''a scheme to embezzle funds.'' The
insurer's attorneys say Forrest conspired with Casualty employees to
secretly write checks to one of her businesses. The total allegedly
embezzled: $144,957.

When Forrest failed to appear in court, a judge entered default
judgments for ''civil theft,'' assessing triple damages against her and
her companies.

In February of this year, another judge prohibited Forrest from
''engaging persons in employment'' until she pays the state $17,086 in
unemployment taxes that she and Forrest Construction owe. She has not
paid, court records show. Yet she still employs nine DAC workers.

FORREST'S RESPONSE

`All past problems are corrected,' she wrote

Forrest declined to address the legal issues in detail, saying several
matters remain pending. She said she asked the judge to dismiss the
bankruptcy, and is negotiating with the state to pay the unemployment
taxes. She did not address a Herald question about the embezzlement
allegation, saying only that she hadn't appeared in court because she
couldn't afford an attorney and that she is close to resolving the
problem.

''As a small business, we encounter difficulties on many fronts,
including the cash flow problems, which affects everything else we are
responsible for,'' Forrest wrote. ``All past problems are corrected.''

In July, DAC paid $37,611 on her behalf to settle a lawsuit filed by one
of her creditors. The consultant has also covered paychecks to her
employees several times. 'I just can't go, `The minute she has problems,
kick her out of the joint venture,' '' said Massman, the DAC program
manager.

The airport is also indirectly sending money to Richard Clark as he
enjoys retirement in a quiet fold of the Blue Ridge Mountains. He is a
paid lobbyist for a politically connected group that has earned $311
million in gross revenue over seven years running MIA's Duty Free
stores.

The Miami-Dade inspector general recently issued a report about that
joint venture. Its finding: The minority partners in that job did little
but collect money.


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