A variation on Pay to Play, to be sure. I don’t know that this got much attention by the NJ, but recently, Insurance Commissioner Karen Weldin Stewart claimed that the Captive Insurance section was suddenly generating a surplus AND that she was having that “surplus” returned to the General Fund to be specifically directed to the City of Wilmington. This is a pretty sweet deal and interesting that suddenly this program has a “surplus”. It is even more interesting that she just sends a big chunk of that “surplus” to the City of Wilmington, which is the source of one of the few Party endorsements she received.
If you pay close attention to the press release linked to above, this is what you get:
- Excessive backpatting on the “success” of the captive insurance program.
- The announcement of directing “surplus” funds to Wilmington, couched in a whole lot of legal citations — making it tough to tell if this authority actually exists to direct money to a single entity.More backpatting about the captive insurance program, but now the backpatting expects you to buzz by the crucial questions:
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- Why report the 2011 revenue number when you are returning money based on the 2012 revenues?
- What is the net revenue from this program (anyone remember all of the pricey contracts awarded to KWS campaign contributors?)
- And if this program has been so successful for each year KWS has been in office, why is it that only 2012 generated “surpluses” that could be returned to operating funds?
I doubt I’ll get answers to any of this, but Mitch Crane’s campaign has sent out a press release that sorts out some of the issues here. It is rare that I’ll reproduce a press release like this, but will do so here, because it tells how that “surplus” came to be:
Commissioner Stewart uses budgetary gimmick, calls it a surplus
Wilmington, DE – Current Insurance Commissioner, Karen Weldin Stewart, today announced that the Captive Bureau at the Department of Insurance has recorded a surplus. Upon further review however, the “surplus” is merely a budgeting gimmick intended to distract voters from the more than a million dollars in no-bid contracts for her political supporters.
During the first three years after the creation of the Captive Bureau in 2009, Commissioner Stewart awarded no-bid contracts totalling over $1.7 million to hire 3 individuals. One of those contracts totalling $196,080 per year, was awarded to Steve Kinion, who donated more than $2,000 to the commissioner’s 2008 political campaign. Mr Kinion was contracted as the Director of the Delaware Captive Bureau despite the fact that he lives and maintains a law practice in Springfield, Illinois.
While the current commissioner claims responsibility for an alleged surplus of $250,000, she is misleading voters about the origin of these funds just weeks before the Democratic Primary. The source of the “surplus” can be traced back to these no-bid contracts. With the recent non-renewal of two of the three no-bid contracts, over $370,000 was freed up from the Captive Bureau. Commissioner Stewart had contracted with Ed Ianni for a whopping $196,000 a year and Mary Jo Lopez for $174,000 a year, from FY 2009 through FY 2011, but their contracts were not renewed for FY 2012; leading to the alleged “surplus.”
The Democratic Party’s Endorsed Candidate for Delaware Insurance Commissioner, Mitch Crane, wasted no time in criticizing the current commissioner’s handling of the Captive Bureau. “The current commissioner is engaging in budgetary gimmicks in order to distract voters from her failed record and anti-consumer policies. The fact of the matter is, she has dumped millions of dollars in no-bid contracts into the captive bureau, which only serves the interests of corporations, while allowing constituent complaints to go unanswered due to an understaffed office of constituent services.”
Crane continued, “If I am elected commissioner, I will terminate the exorbitant, six-figure contracts for the current commissioner’s political backers, and instead use that money to fully staff the office of constituent services with merit employees to once again serve the needs of Delawareans.”
Residents of the City of Wilmington are surely glad to have the extra funds, but how is this not a new(ish) page of the Delaware Way? Not only in having a government official pretty much making up the rules as she goes along, but making up “surpluses” (and why not tell the world you’ve released part of your pay to play crew? *That* might be welcome news.) and deciding to suddenly send funds to Wilmington when you are desperate to get votes in the City is a sign of an office that badly needs adult supervision. It’s not clear to me that what she’s done is entirely kosher, but I’m not going to pretend that I’m clear on the legalese cited, either.
So we have an ICs office who has de-prioritized consumer services, sends out secret RFPs by which her friends get hugely lucrative contracts, lets DE Blue Cross be absorbed in a deal that is going to look pretty bad to those insured in a couple of years and can’t get interested in a real patient issue until the Senator from West Virginia gets involved. There’s plenty more, but it still doesn’t add up to an ICs office that works for the citizens of Delaware. And apparently this office decided that the way to catch up on the work that should have been done for people in Wilmington was to deliver a fat envelope to City administration, who are the last people you call when you have an insurance issue.