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Summers' job program fails to live up to claims of success

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Summers' job program fails to live up to claims of success

AUGUSTA — Republican Charlie Summers has pinned his campaign for the U. S. Senate on a vow to improve the economy and create jobs on a national level, the way he says he has in Maine.

As secretary of state, Summers added a $50,000 "Small Business Advocate" in his office that his campaign website claims shows how “investing in small businesses will create jobs and strengthen our economy.”

If elected, Summers says he will “introduce legislation that will create a national small business advocate, just like the one I successfully lobbied for in Maine who has already saved Maine businesses from undue state regulators.”

But a Maine Center for Public Interest Reporting examination of the business advocate’s own records reveals a much more mixed story of the effectiveness of the new position.

While Summers boasts the program is a job creator, in the 10 months it has been in operation, records show few, if any, new jobs can be directly attributed to the work of the business advocate.

For seven weeks this spring and summer, from June 1 to July 27, the advocate did not have a single open case, according to weekly activity reports.

The records also reveal the advocate claims credit for solving problems that others solved, and suffers from legal restrictions that handicap his effectiveness.

Dan Billings, chief legal counsel to Gov. Paul LePage – and as of Monday a nominee to the state's District Court bench – was critical of the position on As Maine Goes, the popular web forum for Maine Republicans: "My point is that someone should look at whether the Small Business Advocate is actually making a difference or just taking credit for cases that were on the way to resolution anyway,” he wrote on May 13.

Responding to the center’s findings, Summers said, “We’ve met with some early successes in this, but I think to actually quantify, in the longer term you’ll need a few years of data. Do I think it’s a success, do I think it’s a success that the state government now has a position of someone who can act independently of the executive? Yeah, I think that’s a success.”

One of Summers’ opponents in the June GOP primary noted the contradiction of a limited-government candidate expanding his own government agency.

On his campaign Facebook page, Rick Bennett, former president of the Maine Senate, noted “the irony of trying to solve a problem created by government with more government.”

Aided by GOP sweep

Summers was sworn into office in January 2011, shortly after the Republican sweep of the Statehouse. His position is elected by the Legislature.

His election followed two terms in the state Senate, nine years as U.S. Sen. Olympia Snowe’s state director, a stint as the region’s Small Business Administration head, and three failed campaigns for Congress. He is a member of the U.S. Navy Reserve and served in Iraq and Afghanistan.

Summers, Democrat Cynthia Dill and independent Angus King are the leading candidates for Snowe’s open seat.

Summers proposed the small business advocate to “assist businesses when established agency procedures fail to resolve problems or disputes,” he told a legislative committee.

Summers’ proposal passed, and in October 2011 he appointed Jay Martin of Old Town to the job. Martin started work on Oct. 6, 2011.

Previously, Martin ran his own consulting firm, Write It Right, where he helped businesses write grant applications and proposals, and performed related services.

Martin says his office has received 117 cases and has "closed" 22 of them. Three cases are what he called “pending,” while 41 were referred to other departments, 37 never opened and 14 were deemed “outside the scope” of the office.

The cases range from a drug store fighting a fine over an unlicensed pharmacist to a Portland business battling with regulators about its waste-water discharges.

Martin typically asks businesses to fill out an intake form, researches the problem, and talks to regulators in relevant departments.

If he decides to go further with a case, Martin goes to bat for business owners by requesting a range of actions from other state agencies: reduced fines, sanctions eliminated, licenses granted or restored. In several cases, Martin urged a department to exercise “discretion” and limit the severity of a sanction or eliminate it altogether.

Some business owners have praised Martin’s work, including developers of a disc golf course.

4 seasonal jobs retained

“Jay most certainly put 100 percent of his effort into helping us save the disc golf course from being closed down by the DEP,” wrote Dr. James LaVallee and Ron LaVallee, owners of LaVallee Links in Randolph.

The LaVallees had been involved in a conflict with the state over environmental construction violations at their new course. Resolving the conflict, wrote Martin in a report, meant “fourseasonaljobs retained.”

Another case involved a Bath drug store facing almost $500,000 in repayment of Medicaid fees to the state Department of Health and Human Services because a pharmacist had been practicing without a current license for three years. The drugstore owner said he would have to close or sell if forced to pay, which Martin wrote would result in the loss of 16 year-round jobs and 25 seasonal ones.

Martin joined the Wilson’s Drug Store’s attorney in requesting an unreasonable and unfair” repayment amount be reduced. Ultimately, the amount was lowered to $25,700, and the drugstore remained open, leading Martin to claim, “the Advocate negotiated an equitable resolution between the owner and state agency.”

Herbert Downs, director of audit for DHHS, disputed Martin’s claim that he had negotiated the settlement.

“No, that would not be true at all,” Downs said.

Downs said Martin “sat in on the meeting” and “commented,” but the negotiation was among the pharmacist’s attorney, Downs and a DHHS staffer.

“Without question,” Summers responded, “had the small business advocate not been put into statute by the Legislature and signed by the governor, these individuals would have had a much different reception.”

After discussing the pharmacy case, Summers could cite only one more example of the advocate’s success, and had to be prompted by Martin.

“I know that there are others, there are, I think, well, there’s the golf ...” Summers said, his voice trailing off.

“And, specifically, the coffee company,” Martin added.

The coffee company was Portland business Kerry Ingredients & Flavors, the Maine outpost of the multinational flavorings giant Kerry Group. Martin’s own records in that case demonstrate the difficulty in crediting the advocate with settling disputes and creating jobs.

The city of Portland, citing Department of Environmental Protection regulations, wanted Kerry to install a system to separate roof drainage from its waste water; the company wanted to take a less costly route.

Martin attended a decisive meeting on Feb. 3 with company and state and local officials. In a Feb. 9 e-mail to Portland state Rep. Peter Stuckey, Martin wrote that Kerry would be able to use a less expensive option for handling its waste water.

“I understand that Kerry now may move ahead with its expansion plans, possibly creating as many as 20 new manufacturing jobs,” wrote Martin. “Though I played a minor role in resolving this issue, I am pleased that this group achieved an equitable resolution to a legitimate regulatory enforcement grievance.”

Yet, in a report dated only two weeks later, Martin claims a larger role and had a new jobs number: “The Advocate negotiated an equitable resolution between the manager and state agency. ... Business is now able to move ahead with expansion plans that will likely create 10 full-time manufacturing jobs.”

Martin’s claim of a “likely” 10 jobs was made after an e-mail exchange in which a firm official is vague about the number of jobs.

In a Feb. 16 e-mail to Kerry employee Christopher Thiel, Martin asked, “I recall you describing your expansion plans as creating up to 20 jobs. Is that correct?”

Thiel responded, “not sure on the quantity, but we have potential business that we are working on that could increase our volume by 30-50 percent, which will result in a transposable figure of jobs for people.”

Kerry spokeswoman Teresa Polli said that Portland facility has had the “same head count since February” and has not expanded.

Martin responded to that news by saying that he had not actually claimed jobs would be created, only that they might be.

Summers conceded that by creating the advocate’s position, he had not created jobs.

“I don’t think government creates jobs,” he said. “But I do think that the atmosphere that we create has an effect on whether or not a business is willing to come to the state of Maine, or invest in the state of Maine or grow in the state of Maine.

“That business knows that, if there is truly a problem they can come to our office and they will have a very open and unbiased ear to tell their story to and if we can be of help, and in a number of occasions over the last ten months we have been able to be of help.”

Barred from meeting

Martin’s effectiveness has been hampered by laws and regulations that prevent him from gaining access to certain agency records or proceedings.

In the case of Great Falls Builders, the Gorham construction company was in a conflict with the state’s Unemployment Insurance Commission over whether certain workers were employees or subcontractors.

Martin proposed to join Great Falls President Jon Smith at a hearing before the commission. In a note to the case file, Martin wrote that the chairwoman of the commission “politely said that I am not allowed to attend due to the confidential nature of information shared at that meeting. I asked her to reconsider but she said her decision was firm.”

The file note says, “Mr. Smith ultimately lost his appeal to the UIC. Case closed.”

In an interview last week, Billings, who supported Bennett in the gubernatorial primary, was less critical of the position:

“It’s still pretty early on in the process to make a judgment,” he said. “At the end of the day, I think we’re all in agreement to have someone located somewhere to help people work through the minefield of state regulations and bring some pressure to bear when an agency isn’t acting appropriately.”

Testifying to a legislative committee about the small business advocate’s duties, Summers said, “I believe they can be effectively executed within the existing resources of the Secretary of State’s Office.”

In fact, the position in the budget that Martin eventually took had been frozen until 2011. When it was “unfrozen,” Summers had the option of filling it or leaving it vacant. He chose to fill it with the advocate position at a cost to taxpayers of $80,000-$84,000 for salary and benefits.

Was the addition of the position a contradiction of Summers’ stated goal of “cutting government?”

“No,” Summers said. “The position already existed and chances are it would have been filled” by naming a new assistant secretary of state.

Naomi Shalit and John Christie are senior reporters with the Maine Center for Public Interest Reporting, a nonpartisan, non-profit news service based in Hallowell. E-mail: mainecenter@gmail.com. Web: pinetreewatchdog.org.