A deal to treat the city's raw sewage is fraught with millions of wasted dollars, conflicts of interest, and very likely illegal conduct on the part of Commissioner Keith Wasserstrom, who, along with Mayor Mara Giulianti's son, stands to personally profit from the entire stinking mess.
It wasn't supposed to turn out that way. Ostensibly, it all began as a benign plan to treat sludge at the Hollywood Lakes' wastewater plant before it was hauled halfway across the state to Arcadia. To find the right company, the city accepted bids and formed a committee of six public-sanitation experts to evaluate them. That committee, which included four Hollywood officials, eventually chose Punta Gorda-based Florida-N-Viro, a reputable company that offered to do the job for $12.7 million.
The second-ranked firm, Minneapolis-based Schwing Bioset Technologies, put the price at almost $15 million more. Worse, it couldn't explain why it was so expensive, says former Dania Beach utilities director Mike Sheridan, a committee member. Florida-N-Viro, on the other hand, "looked to be very strong," he offers. "They had good backing, their financials were in order, and their initial price was good."
But the committee's work was hijacked. When the contract came up for a vote before the Hollywood commission on March 17, Giulianti and Wasserstrom pushed hard for the losing firm, which won the day. Both, however, recused themselves from voting because Wasserstrom had a "relationship" with Schwing Bioset that involved his uncle. Giulianti bowed out because her son, Stacey Giulianti, is Wasserstrom's law partner. The mayor assured her city on the dais, however, that no money was involved.
The meeting was an obvious sham. Something smelled, so I called Wasserstrom to find out what it was.
The commissioner told me that he had fallen in "love" with Schwing Bioset more than a year ago, before any bids were even accepted. He said a friend introduced him to Larry Wakinyan, a Native American who runs a buffalo meat company on a reservation in Oregon. What does Oregon buffalo meat have to do with Hollywood sewage? Well, Wakinyan runs a company that partners with Schwing Bioset called Bionative Technologies. Bionative's role in the Hollywood deal was to secure an agreement with the Seminole Tribe, which owns thousands of acres in the Everglades, to receive all the treated sewage for fertilizer.
Wakinyan sold Wasserstrom on the Schwing Bioset process. "I said that [Schwing Bioset] should come to Hollywood because it's a great product," he gushed.
The commissioner told me he so adored the company that he got his 62-year-old uncle, Arnold Goldman, a sales job at Schwing Bioset. Wasserstrom also agreed to represent the company before other governments -- including his own. In February 2003, he brought Wakinyan and Schwing Bioset executive Ed Voss to Hollywood City Hall for a meeting with Whit Van Cott, the city's utilities director. "I introduced these guys to Whit and... truly, Whit fell in love with the process just as I did," Wasserstrom said.
Wasserstrom said he also contacted the City of Fort Lauderdale and Miami-Dade County on behalf of Schwing Bioset and that Stacey Giulianti had assisted with the work for the firm.
How much has the law firm been paid?
"Zero, zero, no money," Wasserstrom responded. "But I honestly intend to make money down the line if it's successful and if they need a lawyer in other jurisdictions. But to date, I've spent a lot of time and effort because I think it's a great thing for the city."
After more questioning, he admitted that he's actually billing his Uncle Arnold for the Schwing Bioset work. "I have been employed by my uncle to help him negotiate his contract with Bioset and have helped him with introductions in other municipalities," Wasserstrom concedes. His uncle "pays hourly attorney's fees to my firm... But he hasn't paid us yet."
Why hasn't his uncle paid the firm?
"Because Bioset hasn't paid him yet."
So Wasserstrom simply uses his uncle as the middleman in his financial arrangement with Schwing Bioset. And that is why the mayor also has a conflict of interest, Wasserstrom says. "Her son is involved," the commissioner admitted. "The problem is that anything that inures to my benefit also inures to his benefit. So, since they are family, she has the same conflict."
In addition to Wasserstrom and Giulianti, Van Cott has been a vociferous advocate of Schwing Bioset. During the past year, he has consistently tried to undercut the committee's decisions. After a preliminary vote last spring ranked N-Viro first and Schwing Bioset dead last among four competing firms, Van Cott urged the city in a June memo to drop the process and negotiate with the losing bidder.
On March 2, two weeks before the commission meeting, the utilities director sent another memo again urging city commissioners to reject N-Viro. In a four-page missive, the utilities director claimed that N-Viro had financial problems, would create more truck traffic, and had been plagued with odor problems at a plant in Fort Meade, Florida, in 2002.
That facility, however, didn't have controls like the one planned for Hollywood will. Furthermore, the evaluation committee visited an N-Viro plant in Syracuse and found that the end product had no "significant odor." The N-Viro plan did call for seven more truck trips a day, but is eliminating that worth $15 million?
Van Cott insisted last week that he is not biased, though he does acknowledge that Wasserstrom introduced him to the process and that the commissioner's uncle has contacted him on behalf of Schwing Bioset.
"Where there is smoke, there is fire," Florida-N-Viro Vice President Harris Bowers counters. "This was fixed from before day one."
More smoke: On March 12, Bionative's Wakinyan e-mailed Wasserstrom a letter that reveals just how deeply rigged the process was. In it, Wakinyan writes that officials from the city and Schwing Bioset decided to negotiate a deal on March 18 -- one day after the commission meeting. Travel arrangements had already been made. "We have certainly appreciated your support in the past... and look forward to that support in the future," Wakinyan wrote Wasserstrom.
The timing is also interesting -- it was the first meeting after the March 9 elections. Wasserstrom admitted that the Schwing Bioset vote was intentionally pushed past the election because he was concerned that N-Viro representatives might publicly complain of corruption on the city's part. How exactly Wasserstrom gets to decide the timing of votes -- which is supposed to be dictated by city staff -- isn't clear. Call it the power of love.
The meeting -- which should go down in the annals of perverse civic history -- began with Giulianti, who declined to comment for this article, and Wasserstrom both recusing themselves from voting. (It was covered by neither the Sun-Sentinel nor the Miami Herald.) Despite the recusal, Giulianti conducted the meeting -- and her bias was soon evident. As N-Viro lawyer David Mancuta made the company's case, she repeatedly interrupted and, reading from notes, criticized the Punta Gorda firm. Her allegiance was clear even before she declared, "I believe Schwing Bioset is the best in dealing with the community."
Some recusal.
After N-Viro made its case, Wakinyan laid it on thick for Schwing Bioset. Dressed in jeans and a colorful Native American shirt, the barrel-chested buffalo farmer, who has long black hair and wore a feathery necklace, took the podium and appealed to the commissioners' spirituality. "As native people, we look several generations down the road...," he told them. "We're asking that you take that journey with us mentally and spiritually."
Then, without prompting, he offered this denial: "We've done nothing under the table. We've paid no kickbacks, and we will never do that. We simply do not operate in that fashion."
After Wakinyan protested too much, Van Cott urged the commission in a loud and passionate voice to ignore the committee's recommendation and hire Schwing Bioset.
Commissioner Fran Russo called Van Cott's representation "one-sided" and said she didn't think it was a good idea to overturn the bidding process.
Commissioner Peter Bober asked, "Why in God's name do we have [a bidding] process?"
He also asked the $15 million question: Why was Schwing Bioset so much more expensive than N-Viro?
Schwing Bioset representative Tom Lyons literally stammered his way through a non-answer. "It's, it's, it's a fair price," Lyons said. "It's, it's a lot of equipment here, a lot of technology, it's, you know, again, it's, all I can say is, be careful, be careful, there's always a..."
Lyons was dumbstruck -- he couldn't come up with a word.
Then Wasserstrom said something inaudible from the dais.
"That's right," Lyons said. "You get what you pay for."
Other commissioners understandably seemed confused. Beam Furr said he felt more time was needed to make a decision. Giulianti and Wasserstrom quickly shot down Furr's suggestion that they visit an N-Viro plant. An inexplicably angry Sal Oliveri repeatedly yelled that he would go along with whatever Van Cott recommended. Cathleen Anderson also seemed agitated and kept asking that the Seminole Tribe help the city pay for the project.
Into this sea of uncertainty sailed Wasserstrom, a former University of Pennsylvania cheerleader, who pleaded with his fellow commissioners to vote for Schwing Bioset. "We have the Seminoles, who are very excited about how this is going to improve the environment and improve dirt," he said. "I just honestly became very fascinated by it and very supportive of [Schwing Bioset's] product... Driving raw sludge through our streets -- it's crazy that is going on right now. As Native Americans, that pains them immensely, and I've heard their pain."
Improve dirt? Heard their pain?
Then he reiterated his belief in Schwing Bioset. "I wouldn't be going to other county commissions and telling them [about Bioset] if I didn't believe it," Wasserstrom said. "The reps are extremely aboveboard and honest. It's not a close call... I cannot vote, but I encourage you to do the right thing for the City of Hollywood."
The elderly Anderson, who wears a huge pair of black eyeglasses under her white hair, then beamed at Wasserstrom and said, "I want to thank you for that very enlightening talk... I'm sure that you are just as brilliant as anybody else in this room."
With N-Viro demonized and Schwing Bioset wrapped in Native American romance, the commission voted 3-2 in favor of Schwing Bioset, with Bober and Russo comprising the minority. Negotiations are under way with Bioset for the contract.
It's still possible the decision could be overturned. Furr said last week during a commission meeting that he still believes the vote was rushed and would like to revisit it. If either Oliveri or Anderson agrees with him, the city would have to have another vote.
But a reversal, while needed, won't address the central issue, namely that Hollywood is dirty. Of course, we already knew that (please see: Koslow, Alan). But this deal was the political equivalent of a bank robbery in broad daylight on a busy street.
Needless to say, the situation calls for a criminal investigation. Preferably by a statewide prosecutor or the feds -- anything but State Attorney Michael Satz's do-nothing public corruption unit. They only have to follow the smell.
