Attorney Adam Linkhorst Quoted in Palm Beach Post
A port official accused his boss of bid rigging. The port paid the official to keep quiet.
Andrew Marra – Palm Beach Post
The Port of Palm Beach paid one of its top executives more than $60,000 to resign last year after he accused the port’s executive director of rigging a contract-bidding process to favor an acquaintance’s company.
A third-party investigation found no conclusive proof of the claim but revealed what a government watchdog called a troubling scenario: The port director restarted the bidding for a landscaping contract after an unsuccessful bidder treated him to lunch at a West Palm Beach steakhouse.
Two months after the accusation, port commissioners quietly approved a settlement with the executive who made it, one that required that he never reveal any “non-public information” about the port and “make no criticism or negative statements” about it or its employees.
The payout, which included $14,500 of severance pay and $48,400 for a “full release” of future legal claims, was approved despite a state law barring government agencies from using severance to prevent employees from discussing disputes that prompted their departures, The Palm Beach Post found.
While the money failed to settle any existing lawsuits, it restricted the port’s security director, Ken Hern, from publicly leveling the main accusation in his complaint: that port Executive Director Manuel Almira ordered him to “fix” the bidding on a contract “so a friend of his would receive the award.”
The allegation had come to the attention of the port’s five elected commissioners this past July, when Hern sent them an email calling for them to investigate Almira’s actions.
Bid rigging, Cuba trade embargo among complaints
It was the climax of a raucous summer for the port’s small administrative team. In addition to Hern’s claim, Almira last year faced a misconduct accusation from another high-ranking port official, who claimed Almira had tried to use the port to elude the Cuban trade embargo. A private investigation later cleared him.
Hern’s allegation, which was accompanied by claims that Almira made bigoted and racist remarks about port commissioners, centered on a bidding process for a small contract to do landscaping work at the publicly operated port in Riviera Beach.
Hern, who was facing disciplinary action from Almira when he leveled the accusations, told an attorney hired to investigate his claim that Almira called him into his office in late April or early May, around the time of the first bidding process. He said Almira asked “what they could do for his friend,” according to a copy of the investigative report obtained through a public records request.
Almira, he said, was referring to Property Works, a West Palm Beach landscaping company owned by two brothers. The company had bid on a landscaping contract in March, but its proposal was one of the most expensive, disqualifying it from consideration.
Hern said he suggested to Almira that, to help Property Works, they could expand the size of the contract and restart the bidding process.
Almira, he said, told him to do so. Hern said Almira also asked him for copies of all bids submitted in the first round.
In an interview with the investigating attorney, Almira admitted to telling Hern to restart the bidding, though he insisted he did so merely to expand the landscaping duties, not to aid any company.
This time, Property Works won the contract by submitting the lowest bid – a figure the company later admitted it copied from another company’s winning bid in 2017.
But between the two bidding processes, records show, Property Works did not sit idly by.
The investigation revealed that 11 days after port officials determined Property Works’ bid was too high, one of the owners met Almira for lunch at the Okeechobee Steakhouse, an upscale eatery west of West Palm Beach.
Almira ordered a Caesar salad, records indicate, and the company’s co-owner, Anthony Batallan, paid $25 for it.
The lunch meeting took place during a “cone of silence,” when port rules prohibit companies and port officials from discussing pending bids. Almira admitted to the investigating attorney that they discussed port business, but he denied talking about the landscaping contract.
The reason for their lunch meeting is not clear. Almira denied Hern’s claim that he and the company’s owners were friends, but he estimated that he had met them for lunch four times. The investigative report offers no explanation for how he knew the owners or why he met with them.
What is clear from invoices and emails gathered by the investigating attorney, Bari Goldstein, is that at least twice, Almira ate lunch on the Property Works owners’ dime – and paid them back only after Hern filed his complaint in July.
Invoices provided by Almira show that in July he compensated the owners $25 for an April 30 lunch at the Okeechobee Steakhouse – five days before Hern reopened the bidding — and $45 for a June 24 lunch at the Palm Beach Yacht Club.
Florida’s ethics laws prohibit high-level public officials from accepting gifts worth more than $100 from companies they do business with, including meals. But gifts valued at less than that amount are permitted. Because Almira paid back the two meals within three months of receiving them, they are not considered gifts under the code.
The port’s ethics code says employees may not “accept anything of value with the understanding that their official actions or judgment will be influenced” and that “violations of the code of ethics include… soliciting or accepting anything of value such as a gift.” The investigation does not address whether Almira’s actions violated the code.
Goldstein ultimately concluded the bid-rigging allegation could not be supported because, she said, the $8,820 annual contract was small enough that Almira could have awarded it directly to Property Works without opening it for public bidding.
“In the end, this small contract for $8,820 was well within Almira’s authority to award without any bid process,” she wrote.
She did not address whether the lunch meeting conflicted with the port’s ethics code or “cone of silence” rules. She did not opine on, or note, the fact that the company owner had met with and paid for at least one of Almira’s meals during the bidding process.
Almira declined multiple interview requests and declined to answer a list of submitted questions. Hern declined to comment as well.
Batallan, Property Works’ co-owner, said in a statement that the lunch meeting was “consistent with my regular business practices.”
“I meet with business and civic leaders throughout the state of Florida and within the community to introduce and promote our business,” he said. “I express who we are, what we do, and our longstanding track record of providing high quality services and good value.”
‘It just gives the appearance that a bidder is getting some kind of preferential treatment’
Though the amount of money at issue was small compared with the Port of Palm Beach’s $15 million operating budget, legal experts said even an appearance of favoritism can damage an agency’s bidding processes and image.
“The whole underlying principle of public competitive bidding is that it’s going to be a fair process for the bidders,” said Adam Linkhorst, a board-certified construction law attorney based in Jupiter. “Everything is supposed to be transparent; everything is supposed to be fair. And ideally the public is supposed to be served by the lowest responsive bidder.”
Ben Wilcox, research director of Integrity Florida, a government watchdog group, said it was a “terrible” look for a government leader to allow a bidder to buy him lunch during a contract bidding process.
“The optics in the case are terrible,” he said. “It just gives the appearance that a bidder is getting some kind of preferential treatment because of his connection to a local public official. It causes the public to lose confidence in their government and the whole competitive bidding process.”
Blair Ciklin, the port commission’s chairman, defended Almira’s actions. There was nothing inappropriate about meeting a bidder for lunch during the bidding process, he said, since the contract was so small he could have awarded it to the company without competitive bidding anyway.
“For a tiny little contract, I don’t see anything there,” he said. “If the guy bought him lunch, that’s nice of him, but I don’t think that’s why they got the contract.”
The investigation dismissed most of Hern’s claims that Almira made racist and bigoted comments, but it did confirm one allegation – that Almira had joked to Hern about a former port commissioner’s sexual orientation. Almira admitted to doing so in an attempt to “break the tensions” during a tense conversation with Hern about a complaint another port official had made against Hern, Goldstein wrote.
Goldstein concluded Almira’s remark was “inappropriate” but that it did not appear to be “pejorative or demeaning per se.”
Two months after Hern’s complaint was filed, the port’s elected commissioners received a copy of Goldstein’s investigation and conclusions. The investigation had confirmed one of Hern’s allegations, regarding Almira’s comment about a commissioner’s sexuality, and corroborated several components of his bid-rigging allegation.
Still, Goldstein told commissioners she had concluded “there is no significant corroboration for Hern’s allegations.” She suggested that Hern’s accusations “could have been motivated” by the fact that he was facing discipline from Almira for an earlier confrontation with a colleague.
Rather than discussing what actions should flow from the findings, the port’s new general counsel, John Fumero, quickly pushed commissioners to consider settling with Hern.
Attorney: Hern’s employment no longer ‘sustainable’
In a closed-door executive session the following week, Fumero told commissioners that, in the aftermath of the investigation, “I don’t see (Hern’s) continued employment to be sustainable,” according to a meeting transcript.
The question for commissioners, he said, was, “How can we, in a fair manner, separate our relationship with Mr. Hern?”
The port’s attorneys said they were concerned not just about Hern revealing unflattering information. They pointed out that the investigation had unveiled troubling behavior by Hern during his years as the port’s security director.
He was described by many colleagues as short-tempered, the investigation found, and had feuded with several colleagues in the last years of his tenure. The report had concluded “there appears to be significant support (among port officials) for not returning Hern to his position.”
But Hern had rarely been disciplined in the past, the attorneys said. If Almira were to start disciplining him now, they warned, Hern could claim Almira was retaliating against him for the allegations he made. And he could sue.
In addition to buying his silence, they said, a settlement would eliminate the risk of future personnel matters and lawsuits.
It turned out another private attorney hired by the port had already negotiated a tentative settlement with Hern – one that would pay him more than $60,000 to quit and promise never to sue or speak critically of the port, its executive director or any other employee.
Quickly approving the settlement, Fumero explained to commissioners, would ensure not only that Hern could never return, but also that he could not go public with a negative story.
“We’re also getting a non-disparagement clause,” he explained, “which basically means that the parties aren’t going to – if you were to vote for this – that everyone’s going to keep their feelings to themselves and not call up the media and not say nasty things about the individuals involved: commissioners, staff, and so on.”
“And so those are two good things that we, the port, get out of it,” Fumero said.
The severance agreement included $14,534 of severance pay, the equivalent of six weeks’ pay for Hern; an additional $48,448 in exchange for a vow never to sue; and six months of health insurance coverage, at an estimated cost of $10,000.
‘That was basically hush money’
But the agreement also included provisions aimed to restrict Hern’s ability to speak out about his time at the port, including one that he “make no criticism or negative statements” about the port, its employees or “their treatment of me.” Another required that he not divulge any “non-public information” about the port acquired by him or port employees during his time on staff.
Experts say such provisions could run afoul of state law, which bars the use of severance pay in any settlements that “limit the ability of any party to the settlement to discuss the dispute or settlement.”
A veteran municipal lawyer who reviewed the agreement at The Post’s request said the requirement that Hern “make no criticism or negative statements” appeared to violate the statute.
“it seems clear to me that provisions of the settlement agreement seeking to limit the employee’s ability to discuss the employment dispute he asserted against his governmental employer would contravene the provisions of the statute,” said Miami attorney Richard Sarafan, a partner in the law firm Genovese Joblove & Battista and general counsel for Miami Shores.
“At the very least,” he said, “these circumstances raise serious issues of statutory compliance.”
In an interview with The Post, Fumero disputed that the agreement violated the statute. Asked if he believed it restricted Hern’s ability to discuss his allegations about Almira, though, he declined to answer.
“I’m not going to comment on the rights of other people,” he said.
Port Commissioner Joseph Anderson, the port commission’s chairman at the time, voted for the settlement but said he assumed it was just the first step in addressing the issues raised in the investigation.
Instead, he said, the commission quickly dropped the matter after approving the settlement. The investigation was never discussed in public, and no action was taken based on its findings.
In hindsight, Anderson said, the settlement appeared designed not to avoid litigation but to make the issue go away.
“There was no lawsuit,” he said. “That was basically hush money.”
New accusation about Cuban trade embargo
It was just four days later that the port’s administrative team was shaken by another accusation against Almira.
On Sept. 20, four days after port commissioners approved Hern’s settlement, the port’s business development director, Michael Meekins, emailed port commissioners with a new allegation.
The port director, he said, had asked him to help arrange to ship goods through the port to the Bahamas and then on to Cuba. He said Almira told him to pitch the shipping arrangement to a company that does business at the port – while concealing from them the goods’ ultimate destination.
Almira, he feared, was trying to dodge the federal trade embargo with Cuba and potentially implicating the port in it.
“I know this situation should not be happening, and I did not like the fact I was dragged into something that is an attempt to bypass the current US embargo on Cuba,” he wrote.
Fumero investigated the accusations on the port commission’s behalf and cleared Almira of any wrongdoing. He reasoned that even though Almira asked Meekins to conceal the goods’ ultimate destination from the company officials, the proposal would not have violated the trade embargo if he obtained proper permits from the federal government.
Meekins, who asked the port to bar Almira from contacting him while an investigation was conducted, apparently dropped the matter after Almira was cleared. He continues to work at the port and now characterizes his complaints as a misunderstanding.
“There is really nothing to talk about,” he said in an email to The Post. “It was just a simple communication issue that was cleared up quickly.”
Ciklin, the port commission chairman, said the fact that two subordinates accused Almira of misconduct within a two-month span was “kind of strange.”
But he pointed out that the two were very different in nature. And, he said, Almira was cleared of wrongdoing in both of them by attorneys hired by the port.
“He took a lot of abuse in one month’s time,” he said, “but he’s been there a long time and these are the only complaints I can recall.”