Volume 7 Number 42 October 15, 2010

Dear Floridian:

This week, my Department released the audit I called for of the Department of Management Services' construction of the new 1st District Court of Appeal building in Tallahassee. Anticipating that the project was a large abuse of taxpayer dollars, the audit confirms that this project was a perfect storm of lack of appropriate oversight, abdication of responsibility, no-bid contracting and conflicts of interest.

What disappoints me most – especially after I spent four years calling for contracting reform until it finally passed the Legislature this session – is that at no time was the best interest of Florida’s taxpayers at the center of these decisions. And when I think of how strained our court system is in Florida, and how cash-strapped our state's financial situation is, I am offended for every taxpayer.
Read the full audit here.



Alex Sink
State of Florida

CFO Alex Sink Releases Audit Of DMS “Taj Mahal” Construction Project

1st District Court of Appeal building, exterior view

1st DCA interiorFlorida CFO Alex Sink on Tuesday released the results of an audit of the Department of Management Services (DMS) construction project to build the new First District Court of Appeal (DCA) in a letter to Governor Charlie Crist and Chief Justice Charles Canady.

The audit shows that DMS lost control of the project and spent millions more of taxpayer dollars than was necessary to build this courthouse. Outlined within the audit are 17 findings that appear to be inconsistent with Florida statutes, the Florida Administrative Code or generally acceptable internal control practices. Read the letter from CFO Sink.

1st DCA interior1st DCA interiorFlorida laws provide common sense internal controls to ensure that state-owned buildings are constructed in the most cost-effective manner possible. In the case of this courthouse, our audit shows that these controls were circumvented and the interests of the state and the taxpayer were not protected.

CFO Sink outlines 1st DCA costs

The audit clearly shows that without compromising in any way the functional aspects of the new courthouse facility, this project could have been – and should have been – constructed within the budget of the original Legislative appropriation.

Taxpayers can expect that officials responsible for construction of new state-owned facilities exercise proper stewardship of funding, and as this audit shows, that due measure of stewardship was absent here.

CFO Alex Sink Recognizes City Government Week

At Tuesday’s meeting of the Florida Cabinet, CFO Alex Sink sponsored a resolution recognizing October 17 – 23 as City Government Week in the State of Florida. CFO Sink was joined at the presentation by Joy Cooper, Mayor of the City of Hallandale and president of the Florida League of City Government WeekCity Government Week kidsCities, in addition to students, teachers and advisors from Leon County public schools.

City Government Week offers an important opportunity to spread the word to all the citizens of Florida that they can shape and influence this hometown branch of government. It is important to recognize the role played by city governments, dealing with local issues that are the foundation for our diverse Florida cities. City Government Week

The students in attendance were there to observe how government works and to prepare for a “brain bowl” competition, which was designed to engage students in learning about the function and purpose of municipal government. The Florida League of Cities and its member cities have joined together to teach students and other citizens about municipal government through a variety of different projects and information.

Read the City Government Week Resolution.

State Fire Marshal Division Honors Fallen Firefighters

State Fire MarshalLast week, State Fire Marshal Director Julius Halas presented a memorial flag and medallion to each family member attending on behalf of their lost loved ones at the annual Fallen Firefighter Memorial Ceremony at the Florida State Fire College in Ocala. The prayer breakfast and memorial service recognized five Florida firefighters who lost their lives in the past year in the line of duty.

The families of Richard Rhea (Crawfordville Fire Department), Nolen Sauls (Jacksonville Fire and Rescue Department), Robert Strang (Melbourne Fire Department), Neal Tarkington (Jacksonville Fire and Rescue Department) and Roger Taylor (Jacksonville Fire and Rescue Department) were recognized for their supreme sacrifice during the service. In addition to Director Halas, Director John Corbett, Bureau Chief Barry Baker, Bureau Chief Carl Chasteen, Bureau Chief Jim Goodloe, numerous firefighters from across the state, and a statewide Honor Guard participated in the ceremony.

The Office of the Insurance Consumer Advocate Recognizes October as National Down Syndrome Awareness Month Insurance Consumer Advocate

Terry Butler, Interim Insurance Consumer Advocate

Terry Butler, Interim Insurance Consumer Advocate

In recognition of October as National Down Syndrome Awareness Month, the Office of the Insurance Consumer Advocate would like to provide consumers with information regarding child-only insurance policies.

Down Syndrome is the presence of all or part of an extra 21st chromosome. Often Down syndrome is associated with some impairment of cognitive ability and physical growth, and a particular set of facial characteristics. Individuals with Down syndrome tend to have a lower-than-average cognitive ability, often ranging from mild to moderate disabilities. A small number have severe to profound mental disability. The incidence of Down syndrome is estimated at 1 per 800 to 1,000 births, although it is statistically much more common with older mothers.

The condition can produce costly medical complications over an individual’s life span, and thus extensive medical treatment may be needed.

In an effort to encourage insurance companies to offer child-only policies for sick or medically needy children, insurers have been able to charge higher rates for children. However, insurers in Florida have recently decided to no longer offer policies for children only because they can no longer deny coverage for children with pre-existing conditions. Therefore, consumers should make note of child-only health care options available to Floridians through state programs.

Floridians with medically needy children are able to take advantage of Florida’s public insurance programs.

Consumers with additional questions regarding child-only insurance policies or coverage for individuals with disabilities should contact the Division of Consumer Services within the Department of Financial Services on-line at http://www.myfloridacfo.com/Consumers/ or by phone at 1-877-MY-FL-CFO (1-877-693-5236), toll-free in Florida, and (850) 413-3089 from out of state.

The Insurance Consumer Advocate is appointed by Florida Chief Financial Officer Alex Sink and is committed to finding solutions to insurance issues facing Floridians, calling attention to questionable insurance practices, promoting a viable insurance market responsive to the needs of Florida’s diverse population and assuring that rates are fair and justified.

Consumer CornerCFO Sink to Host Women’s Small Business Month Forums in October

Florida CFO Alex Sink and the Department of Financial Services are hosting a series of small business forums as part of Women’s Small Business Month in October.

These forums are open to any business owner seeking to grow and protect their business and will address the insurance and financial needs of small businesses as well as how to access capital and how to make the best use of available technology resources.

Forum participants include Small Business Development Centers, the Internal Revenue Service, local chambers of commerce, and banking and insurance specialists, along with others. Forums will be held in Jacksonville, Daytona Beach, Tampa, Stuart, and North Cape Coral.

Visit http://www.myfloridacfo.com/Consumers/OutReach/EventsbyRegion.asp for a full list of events in your area, or call (850) 413-3089 or toll-free at 1-877-MY-FL-CFO (1-877-693-5236).

Hurricane Season: Are you prepared?Hurricane Checklist: Hurricane Season Isn’t Over Yet!

As Tropical Storm Paula moves away from the United States mainland, sighs of relief can be heard across the state once again. But it isn't too late - a storm could still show up and threaten Florida this hurricane season. Not over till November 30, storms can Homeownerss Financial Toolkitshow up in December, too. So here is a reminder to be prepared for a late season storm.

From the Fort Myers News-Press comes a helpful saying from Cape Coral Fire Chief Bill van Helden, "Hide from the wind and run from the water." Make sure wind can't find you and water can't catch you!

If you live on the water, evacuate when the order comes from the authorities. If you are in a manufactured home in the path of the storm, evacuate.

If you are inland and decide to stay home, assess your dwelling before you decide to ride out the storm. Stay away from windows - find protection in a room with no windows such as a hallway or closet. Once the storm winds begin, stay inside. Flying debris, falling trees or downed power lines can cause injury or death.

If you evacuate or stay home, you need to be prepared for the few days after the storm passes. Electricity may be out and bottled water will be needed. The timing of getting everyday services back depends on the severity of the storm and the preparedness of your community. Electricity could be out a few days or more. The following list of items will make sure that you and your family are prepared for what the storm situation or any emergency may bring.

  • Bottled water (at least one gallon per person per day for three to seven days)
  • Canned goods and nonperishable foods that do not need cooking (three to seven days)
  • Cooler
  • Cell phone and charger, including a car adapter/charger
  • Manual can opener
  • Bleach for cleaning and for purifying water (one-eighth to one-quarter teaspoon of chlorine per gallon)
  • Disposable plates, cups, utensils
  • Pet food
  • Masking or duct tape
  • 100 feet of rope or heavy cord
  • Flashlight or lantern with extra batteries
  • Battery-operated radio with extra batteries
  • Watch or battery-operated clock
  • Extra flashlight or lantern bulbs
  • Matches/lighter
  • Fire extinguisher (ABC type)
  • Lamp or lantern with fuel
  • Portable outdoor camping stove or grill with fuel
  • Plastic trash bags
  • Plastic sheeting or drop cloth
  • Toilet tissue and paper towels
  • Prescription medication (two-week supply)
  • Personal items such as soap, deodorant, toothbrushes, toothpaste, etc.
  • Extra eyeglasses, hearing-aid batteries
  • Extra clothing
  • Towels and blankets
  • Infant care - disposable diapers, baby wipes, formula, baby food
  • First-aid kit including sterile adhesive bandages, gauze pads and rolls, scissors, tweezers, hydrogen peroxide, aspirin, antacid tablets, snake bite kit, antiseptic spray, ointments for burns and cuts, latex gloves
  • Copies of important paperwork and phone numbers, sealed in plastic

Florida Housing HelpFacing Foreclosure? Don’t be Swayed by Headlines

There has been a lot of information in the news recently about banks temporarily halting foreclosures. Although this gives homeowners a short reprieve from the foreclosure process, homeowners need to continue to work with their lenders to find possible options or solutions. Struggling homeowners need to remember that lenders are temporarily halting foreclosures and, at some point, they will restart the foreclosure process and you should be prepared to provide updated documentation and information.

In an effort to assist struggling homeowners, CFO Sink and the Department of Financial Services host Florida Housing Help (FHH) workshops where lenders, counselors and other community resources come together to help homeowners navigate through their housing difficulties.

Upcoming FHH events:

Saturday, October 16 City of Lauderhill's newly constructed City Hall, 5581 W. Oakland Park Blvd; Lauderhill, FL 33311, 10 a.m. to 4 p.m.

Tuesday, October 19 Wakulla Chamber of Commerce, 23 High Drive Crawfordville FL 32326, 5:50 p.m. to 8:30 p.m.

Thursday, October 21 Central Florida Community College, 3001 SW College Rd, Ocala, FL 34474-4415, 5 p.m. to 8 p.m.

Thursday, October 28 Havert L. Fenn Center, 2000 Virginia Avenue, Fort Pierce, FL 34982, Noon to 5 p.m.

Saturday, October 30 Lakeland Public Library, 100 Lake Morton Drive, Lakeland Florida 33801, 10 a.m. to 2 p.m.

The FHH website can help connect struggling Floridians who may be at risk of losing their homes to foreclosure or may be facing mortgage fraud issues with assistance. For a schedule of workshops, visit the Florida Housing Help Calendar.

Safeguard Our SeniorsWhat Is a STOLI?

Stranger-Owned or Stranger-Originated Life Insurance (STOLI) transactions are usually pitched with offers of cash or free insurance, but read on to determine if they are the right deal for you.

In STOLI transactions, a buyer, often a senior, is offered incentives to purchase a life insurance policy for the benefit of investors seeking to profit on the insured’s death. In many cases, the purchaser is encouraged to establish a trust, and the trust is named as the beneficiary and policy owner. At that point, the purchaser cannot change the beneficiary or cancel the policy after it has been issued because they are not the owner; the owner is the trust. The individual named as trustee for the trust is normally a “stranger” to the insured but has complete control over all decisions regarding the policy.

Some STOLI transactions involve annuities, which are normally sold by insurance companies as investments. Annuities are appealing because they typically include a "death benefit" that amounts to a money-back guarantee on the principal amount invested, sometimes including interest. Seniors may be targeted as purchasers due to their shorter life expectancy.

STOLIs are purchased in a manner that allows persons with no insurable interest in the life of the insured to obtain a policy they otherwise could not obtain. In any financial transaction, individuals should be alert for fraud such as misrepresentation, falsification, or omission of material facts in the application.

Facts to consider:

For more information on this and other insurance issues, visit the department’s Insurance Library.

My Family CFOHow Often Should You Change Your Oil?

Extending the life of the oil in your car is an economical move that is also good for the environment. The question to answer is when to actually change the oil. These days, experts can give some guidance on this issue, but not a firm answer and there are many different opinions on the subject. Your oil change interval depends on the owner’s manual recommendation for your specific model car and your everyday driving habits.

For a long time the general guideline for an oil change has been every 3,000 miles. But if you have a car bought in the last seven or eight years, this guideline is outdated. Oil chemistry and engine technology have improved so that most cars can go several thousand more miles before changing the oil. A better average would be 5,000 miles between oil changes for severe driving conditions, and 7,500 miles for mild or normal driving. Not only is money saved by not changing the oil so often, but the environment gains when good oil is not thrown away.

Determine if your typical driving includes stop-and-go, short distances or extended idling. If you often take trips of less than 10 miles, the engine and the oil are not completely warmed up and cool oil cannot deal with the contaminants that come from internal combustion as efficiently. Short trips around town with frequent stops would be harder on your oil and considered severe driving conditions, warranting more frequent oil changes.

Newer model cars have an oil maintenance reminder where the engine control module/computer uses engine temperature, engine speed, and other factors to determine when the engine oil needs changing. Thus if you drive stop-and-go or low speed trips then the interval will be shorter; drive high-speed or longer duration trips then the interval will be longer.

After many years of recommending three thousand miles between oil changes, some of the quick oil change franchises are now suggesting that mechanics tell customers what the manufacturer recommends as the oil change interval under mild or severe driving conditions, which will extend the oil change timing in most cases.