Geisler was clearly aware while writing the study of the conflict of interest inherent in the set-up. On one page, he notes in bolded text that, “to assure independence,” his fee “is not contingent upon the sale of the Bonds.” But Taylor calls that “a smokescreen.” “[The passage] is trying to give a sense of legitimacy to the deal, when that’s not the case at all,” he told TPMmuckraker.
Indeed, the study was in fact the third such report produced on the subject — and the second by Geisler — over a two-year period, according to a Montana source close to the process. The first two studies — the other of which was done internally by Hardin — came to ambiguous conclusions as to whether the project would succeed. After the first two reports, says the source, “the MCM people had [Geisler] come back and do another. That’s when they decided it made sense to go forward.”
To this day, some local officials defend the study, arguing that it’s easy to criticize with the benefit of hindsight. Dan Kern, Hardin’s economic development director in late 2005 and early 2006, told TPMmuckraker he’s not sure why support for the project evaporated after the jail was built. “Everybody told me that this was a great project and there was a need for it,” he said.
But Taylor says if the official bond statement, which includes the feasibility study, was false or misleading, the bond players have legal liability.
Beyond Hardin
It looks like Hardin isn’t the only place where the the lavish promises of Parkey’s consortium failed to pan out.
The Montana state auditor’s memo notes that, in three separate jail deals with Texas counties, pushed through by Parkey’s team, “current revenues are insufficient to cover operating and debt expenses.”
And in 2005, three Texas county commissioners were convicted on bribery charges in connection to one of those Parkey-led projects. As in Hardin, MCM acted as the underwriter, and Hale-Mills handled construction.
All of the companies in the consortium either declined to comment for this story or did not return calls and e-mails.
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